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Investing.com - Bernstein SocGen Group lowered its price target on Virgin Galactic (NYSE:SPCE) stock to $2.00 from $3.00 on Thursday, while maintaining an Underperform rating following the company’s second-quarter results. According to InvestingPro data, the stock has declined nearly 50% year-to-date, with a market capitalization now hovering around $172 million.
Virgin Galactic reported second-quarter adjusted earnings per share of -$1.47 on Wednesday, August 6, beating the consensus estimate of -$2.34. The company’s cash burn for the quarter was $114 million, slightly improved from $122 million in the first quarter but still above the target of below $100 million. InvestingPro analysis reveals concerning financial metrics, including a negative gross profit margin and an EBITDA of -$305 million over the last twelve months.
The space tourism company reiterated its schedule to commercialize Delta class spaceships in fall 2026, though it postponed the launch of its research ship program from summer 2026 to fall 2026 due to fuselage issues. Virgin Galactic also initiated the design phase of its next-generation mothership, LVX, intended to increase flight frequency.
Despite management’s previous indication that peak spending was behind them, capital expenditures reached an all-time high in the second quarter due to investments in production of the first two spaceships. The company expects cash burn to fall between $100 million and $110 million in the third quarter before dropping below $100 million in the fourth quarter.
Virgin Galactic currently has $508 million in cash while burning approximately $100 million quarterly. The company raised $56 million from an at-the-market equity offering in the second quarter and plans to continue utilizing its $300 million at-the-market equity raise capacity announced in the third quarter of 2024 to support future growth. While InvestingPro data shows the company maintains a healthy current ratio of 3.38, suggesting adequate liquidity for near-term obligations, subscribers can access 15+ additional ProTips and comprehensive financial metrics to better evaluate the company’s investment potential.
In other recent news, Virgin Galactic Holdings Inc. reported its second-quarter 2025 earnings, highlighting a reduction in operating expenses and improvements in adjusted EBITDA. The company is making significant progress in spaceship production and has implemented a strategic shift in resource allocation to focus on future commercial spaceflight operations. Despite these advancements, Morgan Stanley (NYSE:MS) has lowered its price target for Virgin Galactic from $5.00 to $2.50, maintaining an Underweight rating. The firm cited delays in the company’s timeline, now expecting the first commercial research flight to occur in fall 2026 instead of summer 2026. These developments reflect Virgin Galactic’s ongoing efforts to streamline operations and manage expectations regarding its ambitious spaceflight plans. Investors are closely watching the company’s progress as it aims for the Delta spacecraft’s entry into service in 2026.
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