Virgin Galactic (NYSE:SPCE) stock bucked the broader market selloff today, as SPCE stock surged roughly 20% on a day when most of Wall Street bled red. That’s quite impressive.
Why is this happening?
Virgin Galactic is booming because they’re sending Richard Branson into space on Sunday. This will be the first passenger spaceflight ever.
This is a huge deal. Virgin has been saying it is going to fly people into space for over a decade. On Sunday, it’s going to make that long-term dream a reality. This moment, this coming weekend’s flight, is truly the culmination of 10-plus years of scientific work.
And just to be clear. We very well could see a “sell the news” event on Monday. But we don’t think that will necessarily happen.
Instead, we see this first commercial spaceflight as such a momentous accomplishment that it only serves to spark more buying power in SPCE stock.
We’re looking for a price above $60 by next week.
SPCE Stock Is a Long-Term Winner
Our bullish outlook is also supported by a favorable long-term outlook on the company.
We firmly believe that the space tourism industry will unlock significant economic value, and that Virgin Galactic will capitalize on this value.
For one, demand for space travel will be enormous. There are a lot of rich people out there who are willing to spend next to anything for a novel experience. And flying to space is just about as novel an experience as you can find these days.
Supply will be extremely limited, since only about two companies in the entire world will be able to offer commercial space tourism opportunities in the coming years.
Big demand for space tourism and low supply means attractive unit economics, high margins and loads of profits.
The long-term potential for space tourism is clearly here, and so is the long-term potential for Virgin Galactic.
Now, more than ever, the short-term catalysts are also in place. This is a stock you want to buy now.
— Luke Lango and the InvestorPlace Research StaffAmerica's #1 Stock Picker: BUY "AMZN of Houses" [sponsor]
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Source: Investor Place