There’s high-flying stocks on Wall Street… and then there’s space tourism stocks. Launched just two years ago, Virgin Galactic Holdings (SPCE) has been a popular name with retail investors.
And with the company looking to finally launch commercial spaceflights, it’s gotten its highest analyst rating yet with a $50 price tag. That’s about a 50 percent increase from the current price of shares in the low $30s.
Year-to-date, shares have run up as high as the $60 range, pulled back to a panic low of $25, and have since rebounded to $33. A move back to $50 would still keep shares well below their speculative highs from earlier in the year.
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As the company hasn’t launched its commercial flights yet, it remains an early-stage name with no profitability that’s been burning through capital. That hasn’t stopped shares from having some big runs in the past few months.
Action to take: Shares are attractive, as the company is likely to be the biggest name in space tourism. Its early lead over competitors can build brand recognition as well.
Traders may like either the shares or buying a call option to play the current trend higher. In the options space, the October $50 calls provide a sufficient strike date and price to potentially make for a great trade. The option last went for $7.10.