Initially priced near $12 a share under the “SPCE” ticker, Virgin Galactic had climbed as high as $12.93 before settling back near $12.23 by early afternoon. It ended the day down, at $11.75.
“Virgin Galactic is making history again today as it becomes the world’s first and only publicly traded commercial human spaceflight company,” chief executive George Whitesides said in a statement. “For the first time, anyone will have the opportunity to invest in a human spaceflight company that is transforming the market.”
The Virgin Galactic debut is a major milestone for the fast-growing space sector, which is projected to be worth $2.7 trillion by 2045, according to Bank of America Merrill Lynch. For years, it has been locked in competition with fellow billionaire-led enterprises, such as Elon Musk’s SpaceX and Jeff Bezos’s Blue Origin. Bezos has said Blue Origin is vying to build a lunar lander for NASA, as it aims to return astronauts to the moon by 2024. (Bezos, the founder and chief executive of Amazon, owns The Washington Post.)
Virgin Galactic was founded in 2004 but suffered serious setbacks after a spaceship came apart during a test flight over the Mojave Desert in 2014, killing co-pilot Michael Alsbury. The company has raised more than $1 billion since its inception, but much of it came directly from Branson. Boeing recently invested $20 million for a 1 percent stake in the company, which said its first commercial flights would commence in mid-2020.
With the capital it raises by going public, Virgin Galactic said it will be able to sustain its operations until it begins commercial flights and starts generating its own revenue. The company estimates it will carry more than 1,500 tourists a year by 2023, according to a regulatory filing, and generate close to $600 million in revenue. But it remains to be seen whether commercial spaceflight will truly take off.
“No disrespect, but Virgin Galactic is both a plan and a dream, rather than a secure cashflow,” Swen Lorenz of Undervalued Shares wrote in a research note ahead of the company’s NYSE debut.
So far, Virgin has flown its vehicle SpaceShipTwo to the edge of space twice. The first flight, in December, was with two test pilots. The second, in February, had two pilots and a crew member. The five members of the flights were awarded commercial astronaut wings by the Federal Aviation Administration.
More than 600 people in 60 countries — including pop star Justin Bieber — have put down more than $80 million in deposits to join Virgin Galactic’s reservation list; that’s $250,000 a ticket. The company’s customer backlog alone would double the number of people who have ever gone to space. Earlier this month, it unveiled the sleek spacesuits Under Armour built for its passengers.
“With our proprietary spaceflight system, special airspace access at Spaceport America, globally-recognized brand and broad investor interest, we believe Virgin Galactic is ideally positioned to capitalize on the fast-growing, multibillion-dollar commercial space market and ultimately open space to thousands of new astronauts,” Branson said before trading began Monday, according to a statement.
Unlike a traditional rocket that launches vertically, Virgin Galactic has built a spaceplane that is tethered to the belly of a carrier airplane, which hoists it to an altitude of about 40,000 feet. There, the spaceplane is released, fires its engine and races through the atmosphere to the edge of space, where passengers would spend about four minutes in a weightless environment.
The company is still transitioning from test facilities to its permanent home in rural New Mexico: Spaceport America, the “world’s first purpose-built commercial spaceport,” which cost New Mexico taxpayers $220 million to build.