Dow Today – VORB Stock Alert: Why Is Virgin Orbit Blasting Off Today?
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Right now, investors in Virgin Orbit (NASDAQ:VORB) are happy it’s Friday. VORB stock has soared more than 25% higher today, finally gaining some altitude after days of nosediving following the company’s high-profile special purpose acquisition company (SPAC) merger last week.
News that Virgin Orbit rung the opening bell of the Nasdaq exchange has been attributed with the pop in VORB stock. That’s right, Sir Richard Branson went on stage, rang a bell and this stock flew. What a market we’re in right now.
Of course, there’s more to the story. However, it’s also clear that space exploration stocks in general are highly volatile. Following Virgin Orbit’s SPAC IPO, this stock plummeted from the IPO reference price of $10 per share to as low as $5.88 per share yesterday. That’s good for a loss of more than 40% in just over a week. Ouch.
However, today’s rise has brought VORB stock back to the $8 mark. So, let’s dive into some of the specifics behind what’s driving this move today.
VORB Stock Soars on Series of Catalysts
As mentioned, the bell-ringing catalyst is what’s generating headline attention for VORB stock today. Name recognition and the fact that more retail investor eyeballs are on this company are goods thing for the stock.
That said, investors are also pricing in another catalyst for VORB stock. Reports circulated today suggesting that Richard Branson is pursuing another SPAC listing, this time in Amsterdam. What would be Virgin’s first European SPAC deal has shed additional light on the company. For investors in Virgin Galactic or Virgin Orbit, having yet another avenue for the conglomerate to raise money appears to be a positive.
Virgin Orbit was able to raise approximately $228 million as a result of last week’s SPAC merger. This European SPAC deal is estimated to be roughly the same size, though how many investors actually stick it out until the merger remains to be seen.
Undoubtedly, the space tourism sector is one that investors want to be a part of right now. That said, this is an area that requires a tremendous amount of capital.
The recent rebound for VORB stock appears to be bullish for the company’s pursuits of leading the pack in this space. Whether yet another SPAC deal is the solution the company needs or not remains to be seen. Still, VORB investors appear to be happy with today’s showing.
On the date of publication, Chris MacDonald did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Chris MacDonald’s love for investing led him to pursue an M(BA) in Finance and take on a number of management roles in corporate finance and venture capital over the past 15 years. His experience as a financial analyst in the past, coupled with his fervor for finding undervalued growth opportunities, contribute to his conservative, long-term investing perspective.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.