Virgin Galactic shares swung back-and-forth in heavy trading Thursday, with the stock ending the day just barely lower.
Shares closed down 0.2% at $37.26, snapping an eight day winning streak, in a finish unrepresentative of Virgin Galactic's volatile trading. Early in trading the stock jumped more than 13% and soared past $40 to a new record high. But the stock later reversed and fell, dropping as much as 17% to about under $32.
Virgin Galactic did set a new record for its trading volume, with 134.5 million shares trading hands on Thursday. That trading volume is nearly seven times its daily average, indicative of Virgin Galactic's recent ascension as Wall Street's favorite speculative play.
The space tourism company has climbed nearly 310% in the past three months, with a large portion of the gains coming in the past two weeks.
There was no public catalyst from the company driving the stock's move. Virgin Galactic CEO George Whitesides spoke Thursday morning at an investor conference hosted by Barclays in Miami — but his presentation is not expected to be released, the bank told CNBC.
Virgin Galactic has little in the way of revenue thus far. When it reported third-quarter results in November, the company booked just $800,000 of revenue for the quarter and a net loss of $138.1 million for the first nine months of 2019.
Morgan Stanley's warning
Virgin Galactic's rally has taken even the most bullish Wall Street analysts by surprise, as Morgan Stanley analyst Adam Jonas said the stock "deserves a bit of a breather here." He noted that it is difficult to identify a major inflection that justifies the stock's move to its current levels.
"A modest correction is overdue, and frankly, healthy, in our opinion," Jonas said.
Morgan Stanley has an overweight rating and a $22 price target on the stock.
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