Call Traders Blast Virgin Galactic Stock After Tourism Update

Call volume is ramping up in response to the news

Deputy Editor
Jun 16, 2023 at 10:44 AM
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Shares of space tourism name Virgin Galactic Holdings Inc (NYSE:SPCE) are surging today, last seen up 29.1% at $5.24 after climbing to $5.97 out of the gate. This comes after the company announced a window of dates for its first commercial space tourism flight later this month, and said it has plans for a follow up commercial flight in early August.

The news has options traders excited, with 96,000 calls and 26,000 puts exchanged so far today, or 16 times the average intraday volume. New positions are opening at the two most popular positions -- the June 6 and 5.50 calls.

A broader look indicates calls were already the popular choice amongst options traders. This is per SPCE's 10-day call/put volume ratio of 11.20 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which stands higher than all other readings from the past year. 

Analysts, however, are less optimistic, with just two of nine in coverage recommending a "strong buy." Meanwhile, the 55.26 million shares sold short account for 23.9% of Virgin Galactic stock's available float, or more than one week's worth of pent-up buying power.

Today's bull gap puts the shares above the $5.20 region, which rejected a May rally. SPCE is also up more than 30% this week, pacing for its best weekly gain since January, and its fourth winning week in the last five. In 2023, Virgin Galactic stock is up 51.1%.

 

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