In the time since Virgin Galactic Holdings Inc. (NYSE: SPCE) went public as the first publicly traded space tourism company, its stock has been volatile. Spaceflight has compelled many investors, but SPCE stock is risky. The company develops commercial spacecraft for scientific missions and space tourism in an intensifying race to become the first company to offer broad space travel. Virgin Galactic has already conducted successful test flights and has had passengers on some of its flights. When these flights become more affordable because of scale, the company may generate strong demand.
Ready to jump on board space tourism? Virgin Galactic could be a great stock pick. Read on to learn how to buy Virgin Galactic now.
| Ticker | Company | ±% | Price | Invest | ||
|---|---|---|---|---|---|---|
| SPCE | Virgin Galactic Hldgs | 4.03% | $6.84 | Buy stock | ||
How to Buy Virgin Galactic Stock
Whether you see Virgin Galactic as your prime opportunity to invest in the exciting future of space travel or you feel as if its recent price explosion is an opportunity to turn a quick profit in a single trading session, the first thing you need to do is learn the basics of buying stocks.
Step 1: Pick a Brokerage
When you're on the hunt for a brokerage, consider what kind of fees it charges, which kind of equities it has access to (such as stocks, exchange-traded funds (ETFs), cryptocurrencies, options) and the educational and research features it offers its investors.
Step 2: Decide How Many Shares You Want
The number of shares you want comes down to personal preference. If you're looking for a short-term trade opportunity, focus on the technical analysis of the stock's price history. If you view SPCE as a long-term growth opportunity, focus on a fundamental analysis of the potential future payoff of the company's current investments in space travel.
Investors may have an easier time buying more shares if they view SPCE as a short-term opportunity. Day traders can capitalize on short-term stock price movements without worrying about long-term prospects. The longer you hold onto SPCE stock, the riskier can become. This factor can influence how many shares you purchase.
It is a good idea to assess your portfolio and allocate a small percentage of your money toward SPCE if you want it in your portfolio. Turning SPCE into a top-heavy position in your portfolio is incredibly risky, especially if the spaceflight company doesn't live up to its expectations.
Step 3: Choose Your Order Type
After you've done your research and know how many shares you want, it's time to place your order. You can either conduct a market order or a limit order. Market orders go through right away at the current price. Limit orders go through when the stock reaches the designated price point that you decided on.
Market Order
A market order is used for quick trading of stocks. Investors tell their broker to buy or sell a stock immediately at the best price. Market orders prioritize speed over precise pricing. It's important to understand market orders when trading small-cap stocks with lower liquidity and bigger price swings. Using market orders in these stocks can result in different execution prices. Investors should consider the consequences of using market orders for quick trades to increase returns and reduce costs. Market orders are essential for efficiently trading in smaller-cap stocks.
Limit Order
A limit order is a trade order to buy or sell at a specified price. It helps investors control their entry or exit points with price guarantees. Investors can set conditions for when orders will be executed. For example, a buyer may only purchase a stock when it drops to a certain price. Sellers can set a limit to sell at a higher price for maximum gains. Using limit orders in trading strategies helps manage risk and make informed decisions, improving overall market strategy effectiveness.
Step 4: Execute Your Trade
Once you've chosen the number of shares and the order type, all that's left is placing the order. At this point, the trade order is in the market and you're waiting for confirmation from your broker when the trade has been executed. Market orders go through within seconds, while limit orders can take longer, depending on when the stock reaches your desired price.
Virgin Galactic and Stock History
Virgin Galactic's stock has decreased by over 84% since the start of the year, in contrast to the S&P 500's 17% increase. This significant decline indicates the continued struggles the company faces in meeting its commercial spaceflight objectives.
Analysts have varied opinions on Virgin Galactic, with some doubtful about its future but others seeing potential growth. Institutional investors are being cautious, with many reducing their holdings due to falling share prices. Virgin Galactic also has a high short interest, suggesting widespread negative sentiment from investors.
The price targets set by Wall Street analysts for Virgin Galactic show a wide range of opinions, highlighting the uncertainty surrounding its future performance. Some analysts are optimistic about potential breakthroughs in space tourism, while others are pessimistic and foresee further declines. This discrepancy demonstrates the unpredictability of Virgin Galactic's stock within the broader market's resilience.
Why Should You Buy Virgin Galactic Stock?
Virgin Galactic is a company leading the commercial space travel industry. Sir Richard Branson founded the company to make space tourism accessible to the public. They offer an exciting experience that combines adventure with advanced spaceflight technology. Virgin Galactic has made significant advancements in spacecraft design and has had successful test flights. Investors see the potential for high returns in this innovative market. Buying Virgin Galactic stock could be a promising investment based on their mission, market position, and growth opportunities.
Strong Brand and Leadership
Virgin Galactic benefits from Richard Branson's leadership and the resources of the Virgin Group. The Virgin brand reputation adds credibility and prestige, giving Virgin Galactic a strong market presence. This reputation sets Virgin Galactic apart from competitors and attracts significant investment. With support from the Virgin Group and innovative space travel approaches, Virgin Galactic is poised to seize opportunities in the aerospace sector.
Innovative Space Tourism Potential
Virgin Galactic is a leader in the space tourism industry. They offer an investment opportunity and aim to make suborbital space flights more accessible. The company's innovative approach could redefine travel and create a new market for space tourism. Investing in Virgin Galactic could be part of a venture that sets new industry standards and drives advancements in aerospace technology. This could also open up new opportunities for commercial space exploration.
Advanced Technology
Virgin Galactic is at the forefront of developing cutting-edge spaceflight technologies with its SpaceShipTwo suborbital vehicle. This spacecraft is designed to provide a unique and thrilling experience by reaching the edge of space. Through its efforts and advancements, Virgin Galactic is pushing the boundaries and positioning itself as a major player in the evolving space travel industry. The company is committed to advancing spaceflight technology and achieving milestones in commercial space tourism, shaping the future of space exploration.
Potential Risks of Buying Virgin Galactic Stock
Investing in emerging space companies like Virgin Galactic may seem appealing due to space tourism and aerospace advancements. However, potential investors should be cautious of significant risks before buying Virgin Galactic stock. Risks include financial stability, competition, regulations, and technology uncertainties. Virgin Galactic faces hurdles that may affect its long-term success and profitability. Understanding these risks is important for anyone considering investing in Virgin Galactic as they can impact stock performance and investment outcomes.
High Volatility and Speculative Nature
Virgin Galactic is a high-risk investment due to its focus on the unproven market of space tourism. The company operates in an uncertain and volatile environment. Space tourism faces challenges like technological and regulatory hurdles. Stock prices can fluctuate due to changes in investor sentiment and industry developments. Investing in Virgin Galactic requires tolerance for significant volatility.
Financial Uncertainty
The company struggles to make consistent profits due to high expenses in pioneering a new industry. Virgin Galactic invests heavily in research, development, and operational costs to advance spaceflight technology. These costs contribute to the company's financial instability and pose a risk to long-term investment returns. High expenses on space vehicles, test flights, and regulations strain financial resources. Investors should note the uncertainty in achieving profitability and financial health.
Regulatory and Technical Challenges
Space tourism must adhere to strict regulations to ensure safety. The company faces challenges in meeting safety standards, government approvals, and technological hurdles. Developing spacecraft, propulsion systems, and life support is crucial. Delays or failures in technology development can lead to setbacks. These setbacks can impact commercial operations and increase costs. Investors should consider the risks associated with regulation and technology challenges.
Is Virgin Galactic Stock Right For You?
Potential investors should carefully consider the risks of investing in Virgin Galactic stock. The company is facing significant cash burn, raising concerns about its financial stability. Profitability has not yet been achieved, which may deter some investors seeking stability. Uncertainty about future revenue generation is a major risk factor. Despite high price targets set by some analysts, operational challenges may hinder Virgin Galactic's ability in turning innovative concepts into sustainable revenue streams.
Analysts have provided mixed ratings for the stock, showing differing views on its potential success. Interestingly, Virgin Galactic has attracted significant short interest, highlighting doubts among some investors regarding its potential for growth.
Potential investors should evaluate both the risks and potential of Virgin Galactic in the commercial space tourism industry before deciding to invest. Considering aspects such as cash burn, profitability, and market sentiment is essential in making informed investment choices.
Frequently Asked Questions
Should I buy Virgin Galactic stock?
Investing in Virgin Galactic depends on your risk tolerance and goals. It’s a high-risk, high-reward opportunity with growth potential and significant challenges. Research thoroughly and consult a financial advisor.
Is Virgin Galactic stock expected to rise?
Predicting Virgin Galactic’s stock performance is uncertain. Despite its exciting space tourism ventures, factors like market conditions, competition, and regulatory challenges will influence its value. Research and consult financial advisors before investing.
Is SPCE a good long-term stock?
SPCE is a risky long-term stock with significant uncertainty. Investors may want to stay on the sidelines and see how it plays out. It’s only an idea to consider for investors with maximum risk tolerance levels.
About Marc Guberti
Marc Guberti is an investing writer passionate about helping people learn more about money management, investing and finance. He has more than 10 years of writing experience focused on finance and digital marketing. His work has been published in U.S. News & World Report, USA Today, InvestorPlace and other publications.