Jefferies sees plenty of potential for the space exploration company
The shares of Virgin Galactic Holding Inc (NYSE:SPCE) are moving higher this morning, last seen up 6.9% to trade at $26.60, after Jefferies initiated coverage on the space exploration company with a "buy" rating and $33 price target. The firm cited "attractive long term prospects of space tourism" as the reason for the bull note, as Virgin Galactic continues to add new spaceships to support growing demand.
The upgrade is notable because there's room for improved sentiment amongst the brokerage bunch, which would boost Virgin Galactic stock even higher. Coming into today, five of the eight analysts covering SPCE recommended a tepid "hold" or worse, though the remaining three all sat at a "strong buy."
Call traders are reacting to the news, too. So far, 23,000 calls have crossed the tape, which is double the intraday average, versus just 5,479 puts. Most popular is the weekly 9/3 27-strike call, where new positions are being opened, followed by the 26-strike call from the same series.
2021 has proven to be a tumultuous year for Virgin Galactic stock. The equity scored a record high of $62.80 on Feb. 4, before steadily chopping lower to breach $15 by mid May -- its lowest level since April 2020. Year-over-year, Virgin Galactic stock is still up 50%, with a short-term floor emerging at the $24 level.