By Christiana Sciaudone
Investing.com -- Virgin Galactic Holdings Inc (NYSE:SPCE) is taking off after getting solid analyst support.
Shares are up 20% Monday after Susquehanna initiated coverage on the Richard Branson company with a positive rating and a price target of $20, according to StreetInsider. It is currently trading around $19.53.
"We see SPCE as an innovator of space technology with a truly unique offering that will allow civilians and professionals alike to access space for entertainment and research purposes," said analyst Charles Minervino. "SPCE’s mission is to 'become the Spaceline for Earth,' expanding the opportunity to travel above the Earth’s atmosphere – an accomplishment achieved by fewer than 600 people throughout history."
The market is untested, but the analyst sees Virgin Galactic's offering tapping into significant latent demand for space tourism. Positive earnings or free cash flow won't show up until 2023 and 2024, respectively, which serves as a fundamental risk.
"We do buy into the vision that SPCE’s future business opportunities can spread considerably wider than what is seen at the moment – ranging from public leisure and professional space travel to government contracting and future high-speed commercial travel," Minervino said.
Minervino is far from alone in his optimism on the stock. It has six buy ratings and no holds or sells.