Virgin Galactic shares plummet by 20 percent as Richard Branson dumps $300million worth of stock to fund his other businesses as excitement over his space tourism flights ‘cools off’
- Branson sold more than 10 million shares between Aug. 10 and 12, according to a regulatory filing from late Thursday
- Virgin’s parent company said that they wanted to focus on leisure and tourism business that had been impacted by COVID
- Morgan Stanley downgraded the stock from equal weight to underweight this week
- Analysts said a lack of planned space flights was part of the skepticism
- It also comes amid competition from other space-chasing billionaires, Elon Musk and Jeff Bezos
Branson sold more than 10 million shares between Aug. 10 and 12, according to a regulatory filing from late Thursday
Richard Branson has sold more of his Virgin Galactic stock – a stake worth $300million – as excitement over the space company ‘cools off’, according to Wall Street analysts.
Branson sold more than 10 million shares between Aug. 10 and 12, according to a regulatory filing from late Thursday.
The move comes a month after the space tourism company completed its first fully crewed test flight into space with Branson on board.
The latest share sale leaves Branson with about 46.3 million shares worth roughly $1.2 billion as of stock’s last closing price. He had in April sold stock worth over $150 million.
The company’s share price fell 20 percent on Friday.
Branson’s Virgin Investments is one of the biggest shareholders of the space tourism company and has a stake of about 22% as of June, according to Refinitiv data.
The company’s shares were last down at $25.09 in premarket trade on Friday.
CNBC cites Wall Street analysts from Morgan Stanley who downgraded the stock from equal weight to underweight this week.
The company’s shares were last down at $25.09 in premarket trade on Friday
They said after an initial period of excitement over Branson’s space flight earlier this year, there had been a ‘cooling off’ of momentum which drove down the value.
Rival space enthusiast Jeff Bezos also launched his own rocket earlier this summer.
In a statement on Thursday night, Branson’s parent company said: ‘The Virgin Group continues to be the largest single shareholder in Virgin Galactic.
‘It intends to use the net proceeds from this sale to support its portfolio of global leisure, holiday and travel businesses that continue to be affected by the impact of the COVID-19 pandemic, in addition to supporting the development and growth of new and existing businesses.’
Branson had planned to launch the first space tourism flight of its kind but analysts say a lack of scheduled trips has brought down excitement over the venture
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