Shares of Virgin Orbit (VORB.US), the company in British billionaire Richard Branson's empire dedicated to launching smaller satellites into space, have fallen more than 91% since its stock market debut. On March 16, the company announced a pause in operations and laid off most of its employees in order to conserve cash and find external financing. Operations came under fire. Reuters reported that the company is close to raising $200 million from a Texas-based venture capital firm owned by Matthew Brown. The support would be through a private placement of shares.
- Financial results showed that the company lost $149 million in the first nine months of 2022. In December 2022, the company managed to raise $20 million through the sale of convertible bonds. It burned through available cash, and failures in recent missions put it on the brink of bankruptcy;
- The company was supposed to make history and as a private provider of satellites for the UK, on a massive scale. The launch of its rocket in England, however, failed; the payload was destroyed. The investigation into the accident is still ongoing. Along with it, the stock price also collapsed;
- The company didn't have to wait too long to find an investor and sentiment improved suddenly. Anonymous sources familiar with the matter said Virgin Orbit is also in talks with two financial institutions for a bailout. The company has conveyed that its next rocket, with the necessary modifications incorporated, is in the final stages of integration and testing.
- In an era of higher interest rates and general risk aversion, the space business is under tremendous pressure. In addition to Virgin Orbit, shares of companies like Momentus (MNTS.US) Virgin Galactic (SPCE.US) and Redwire (RDW.US) have also lost mightily.
Virgin Orbit (VORB.US) shares, M15 interval. Virgin Orbit's price fell mightily, but news of a $200 million injection improved the recently dismal shareholder sentiment. The price climbed above the SMA200 on the short interval signaling bullish momentum. If sentiment on the indexes improves, bulls may want to cover the gap towards the psychological resistance at $1 per share. Source: xStation5
