Why Virgin Galactic Stock Is Down Again Today
The walls are starting to close in on Virgin Galactic (NYSE: SPCE), the space tourism company. The company's stock price has fallen 66% in the past year and as much as 7.3% on Tuesday. At 3:30 p.m. ET, shares are down 5.9% on the day.
The market is falling, and a volatile stock like Virgin Galactic tends to magnify those losses. On top of that, interest rates are rising again with 10-year government bonds in the U.S. rising 12 basis points to 4.8%.
But the problems for Virgin Galactic are more acute. The company has $980 million in cash and expects to burn $120 million to $130 million each quarter for the rest of this year and even then won't be close to free-cash-flow positive. That will take the construction of Delta Class spacecraft that isn't due to be operational until at least 2026. As the stock falls, financial flexibility is getting harder for Virgin Galactic.
Source Fool.com
