Traders Buy Large Volume of Call Options on Virgin Galactic (NYSE:SPCE)

Key Points

• Traders purchased 29,697 call options on Virgin Galactic on Wednesday, roughly a 46% increase over the average call volume, signaling unusually large bullish options activity.
• Despite that activity, SPCE traded at about $3.06 (market cap ≈ $176M) and shows weak fundamentals — a recent EPS of (‑$1.09) that beat estimates but huge negative margins and ROE — while analysts’ consensus rating is "Reduce" with a $4.33 price target.

Virgin Galactic Holdings, Inc. (NYSE:SPCE - Get Free Report) saw unusually large options trading activity on Wednesday. Investors purchased 29,697 call options on the company. This represents an increase of approximately 46% compared to the average volume of 20,307 call options.

Virgin Galactic Price Performance

SPCE stock traded down $0.02 during trading on Wednesday, reaching $3.06. The company's stock had a trading volume of 3,580,454 shares, compared to its average volume of 4,257,954. The company's fifty day moving average is $3.51 and its 200-day moving average is $3.52. Virgin Galactic has a 1 year low of $2.18 and a 1 year high of $6.64. The company has a market capitalization of $175.94 million, a P/E ratio of -0.41 and a beta of 2.01. The company has a quick ratio of 2.87, a current ratio of 2.87 and a debt-to-equity ratio of 1.87.

Virgin Galactic (NYSE:SPCE - Get Free Report) last released its earnings results on Thursday, November 13th. The company reported ($1.09) EPS for the quarter, topping the consensus estimate of ($1.51) by $0.42. Virgin Galactic had a negative net margin of 17,615.71% and a negative return on equity of 108.00%. The firm had revenue of $0.37 million for the quarter, compared to the consensus estimate of $0.32 million. On average, research analysts expect that Virgin Galactic will post -16.05 earnings per share for the current fiscal year.

Analysts Set New Price Targets

Several research analysts have recently weighed in on SPCE shares. Morgan Stanley set a $2.30 price target on shares of Virgin Galactic and gave the stock an "underweight" rating in a research note on Friday, December 12th. Wolfe Research reiterated a "peer perform" rating on shares of Virgin Galactic in a research note on Friday, November 14th. Weiss Ratings reaffirmed a "sell (e+)" rating on shares of Virgin Galactic in a report on Wednesday, October 8th. Finally, Susquehanna reiterated a "neutral" rating and set a $4.00 price objective (up previously from $3.25) on shares of Virgin Galactic in a research report on Thursday, October 9th. One equities research analyst has rated the stock with a Buy rating, three have given a Hold rating and two have assigned a Sell rating to the company's stock. Based on data from MarketBeat, Virgin Galactic has an average rating of "Reduce" and a consensus price target of $4.33.

Institutional Inflows and Outflows

A number of institutional investors have recently made changes to their positions in the business. BNP Paribas Financial Markets increased its stake in Virgin Galactic by 61.9% during the third quarter. BNP Paribas Financial Markets now owns 13,608 shares of the company's stock worth $53,000 after acquiring an additional 5,205 shares during the last quarter. Bank of America Corp DE raised its holdings in Virgin Galactic by 34.1% during the 3rd quarter. Bank of America Corp DE now owns 23,002 shares of the company's stock valued at $89,000 after buying an additional 5,844 shares during the period. American Century Companies Inc. lifted its position in Virgin Galactic by 44.8% in the second quarter. American Century Companies Inc. now owns 19,845 shares of the company's stock worth $54,000 after buying an additional 6,143 shares during the last quarter. Russell Investments Group Ltd. boosted its stake in Virgin Galactic by 76.6% during the second quarter. Russell Investments Group Ltd. now owns 16,773 shares of the company's stock worth $46,000 after buying an additional 7,274 shares during the period. Finally, Rhumbline Advisers increased its position in Virgin Galactic by 21.9% during the first quarter. Rhumbline Advisers now owns 40,487 shares of the company's stock valued at $123,000 after acquiring an additional 7,282 shares during the last quarter. Institutional investors own 46.62% of the company's stock.

About Virgin Galactic

Virgin Galactic Holdings, Inc NYSE: SPCE is a commercial spaceflight company developing and operating spacecraft for private individuals and research customers. The firm's primary business is suborbital human spaceflight, offering passengers a brief trip to the edge of space aboard its reusable spaceplane. In parallel, the company is building out infrastructure and support services for suborbital payload deployments and microgravity research missions.

The core flight system consists of a carrier aircraft, WhiteKnightTwo, which lifts the spaceplane SpaceShipTwo to high altitude before release.

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