Canaccord Genuity analyst Austin Moeller lowered the firm’s price target on Virgin Galactic to $36 from $44 and keeps a Buy rating on the shares after the company announced plans to offer $425M in convertible notes, with purchasers receiving an option for an additional $75M. The stock in midday trading is down 16% to $10.33. The analyst reduced the price target to reflect the potential dilutive impact of the shares from the convertible note offering. However, in his discussion with management today, the company maintained its current schedule to initiate passenger space travel in Q4 of 2022. Moeller remains confident in Virgin Galactic’s business model, which he says features a “promising” total addressable market of at least 1.3M high-net worth individuals. Further, the company has a spaceship platform which has already demonstrated the capability to transport humans into space, says Moeller.
previous post