Just at the end of September, investors rejoiced 12-percent growth of Virgin Galactic shares, and now another piece of news sends the share price back down. Problems with the Federal Aviation Administration (FAA) seem to be over: the regulator is done investigating and allowed Richard Branson’s company get back flying.

However, luck seems to have left the already: the share price of Virgin Galactic headed down again. This time the reason was some changes in the schedule of spacecraft tests and commercial launches. The joint flight with Italian air forces, announced at the beginning of September and scheduled for the end of this month, is postponed again.

You must be interested for how long the flights were postponed and for what reason exactly, as well as how the shares of the company behaved after the information about the changes in the schedule appeared. I’ll try to give you some clues.

Virgin Galactic will be flying again at the end of 2022

On October 14th, at the official website of the company, there appeared information that commercial flights were postponed for October-December, 2022. These changes in the schedule were due to some repairs and maintenance works on Unity spaceships and VMS Eve carriers.

In Virgin Galactic, they say that tests will start again next summer, yet there are no details about exact dates of test flights of Unity 23 and Unity 24. We also know that after the repairs and improvements are over, there will be a test flight. There will be four crew members on board, two of them representing Italian air forces.

Why are improvements necessary?

I’m sure that thought the investigation of the FAA is over, Richard Branson’s company has some conditions to be fulfilled. Firstly, they need to improve calculations of the width of the air corridor for making Unity flights safer. Secondly, they need to improve the preparation and active phases of launches and flights.

In the news on the website, Virgin Galactic states that improvements in spaceships have no connections with the recommendations of the FAA or the investigation. As if the repair program had been planned beforehand, but the decision was made to start it earlier.

By the official version, the aim of the program is to make spacecrafts and their parts more durable for longer and safer exploitation and making further maintenance easier.

Virgin Galactic shares falling by almost 17%

The market reacted quite negative to the information about flights postponed for a year. On October 15th, right on the day after the press-release, the shares of Virgin Galactic Holdings Inc (NYSE: SPCE) dropped to $20.01, losing 16.83%.

This is the second largest decline this year; the first one happened on July 12th. The shares dropped by 17.2% to $40.69. Such a fast downslide was provoked by the news that the company was planning to issue more than 10 million normal shares, getting $500 million for them.

Tech analysis of Virgin Galactic by Maksim Artyomov

Virgin Galactic shares gave investors too little time to enjoy good news about flights allowed again; next thing, investors heard about flights postponed for the next year. They lost all the good attitude towards the company, which immediately was reflected on the chart.

The quotations reached the support level of $20. With the negative news, the quotations are likely to go on falling. The aim of further falling is the next support level of $15.7.

The decline is supported by the 200-days Moving Average that is also declining, remaining under the chart. Judging by the previous surges of the quotations, they might still bounce off $15. However, this can only happen if investors believe in the company again.

Tech analysis of Virgin Galactic shares for 18.10.2021

Summing up

Virgin Galactic reported that flights would be postponed for the fourth quarter of 2022 because of sore repairs and improvements of spacecrafts and spaceship carriers. This news made the shares of the company fall by 16.83% to $20.01.

Test flights will resume in summer 2022. In the first such flights, there will be four crew members, two of them being the representatives of Italian air forces.

More about Virgin Galactic shares on R Blog


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