Virgin Galactic Holdings (SPCE – Research Report), the Technology sector company, was revisited by a Wall Street analyst on November 10. Analyst Noah Poponak from Goldman Sachs remains neutral on the stock and has a $4.50 price target.
Noah Poponak has given his Hold rating due to a combination of factors. He observes that Virgin Galactic has been ramping up its frequency of commercial space flights, but these endeavors are not generating substantial revenue in comparison to the company’s high cash burn rate. Furthermore, the company’s projection to achieve significant revenue and cash generation is not anticipated until 2026, when its Delta ship commences commercial flights. Additionally, the company’s announcement to reduce costs and pause commercial flights with Unity in mid 2024 to concentrate on the development of its Delta fleet puts into question the company’s ability to scale in time without additional dilution, and to generate sufficient demand in the long run.
In the previous quarter, Virgin Galactic reported an adjusted EBITDA of $(87)mn, in line with Poponak’s estimate but better than the FactSet consensus of $(116)mn. The company’s revenue for the quarter stood at $1.7mn, while its free cash flow was $(105)mn, an improvement from $(135)mn in the prior quarter. Despite these figures, the company’s projection for positive free cash flow is not expected until 2026. Given these considerations, Poponak maintains a Neutral stance on Virgin Galactic’s stock.
See Insiders’ Hot Stocks on TipRanks >>
TipRanks tracks over 100,000 company insiders, identifying the select few who excel in timing their transactions. By upgrading to TipRanks Premium, you will gain access to this exclusive data and discover crucial insights to guide your investment decisions. Begin your TipRanks Premium journey today.
Virgin Galactic Holdings (SPCE) Company Description:
Virgin Galactic Holdings Inc is a United States-based vertically-integrated aerospace company pioneering human spaceflight for private individuals & researchers, and it also manufactures advanced air and space vehicles. Using its technologies, it is developing a spaceflight system designed to offer its customers a unique, multi-day, and transformative experience. This culminates in a spaceflight that includes views of Earth from space and several minutes of weightlessness that will launch from Spaceport America, New Mexico.
Read More on SPCE:
