Virgin Orbit is the next space unicorn stock
Everyone knows what a unicorn is, but what is a unicorn Stock?
A unicorn stock is a private company – a company that has not yet gone through the IPO process and isn’t traded on an exchange – it’s so popular that it has already hit an implied valuation of $ 1 billion or more, even without public dollars.
Once upon a time, such “unicorns” were rare. (Hence the name.) In today’s overheated market, however, unicorns are galloping all over the joint. According to the CB Insights market research, nearly 500 private companies worth $ 1 billion are now roaming the Earth, in industries ranging from artificial intelligence to fintech to travel.
However, stocks of unicorns remain extremely rare in a particular sector: space.
Discover Virgin Orbit …
In fact, until 2017, there were only a space unicorn in existence: SpaceX. A second unicorn appeared that year when the small rocket maker Rocket lab crossed the billion dollar mark. This week, investors discovered a potential third space unicorn stock, with Sir Richard Branson’s Virgin Orbit preparing to join the club.
And yes, I said “Virgin Orbit. “Unlike the most famous Virgin Galactic (NYSE: SPCE), Sir Richard Branson is listed on the stock exchange space tourism company, Virgo Orbit is a related company that has not yet been floated on the stock market.
Virgin Orbit was created in 2017, the same year Rocket Lab became a unicorn. Perhaps no coincidence, Virgin Orbit aims to compete directly with Rocket Lab in the small satellite launch market. Rocket Lab currently occupies a leading position in this market, regularly launching its small rockets (carrying small satellites) into orbit from launch platforms securely bolted to the ground in Virginia and New Zealand. In contrast, Virgin Orbit is still trying to enter this market and takes an innovative approach. Instead of launching rockets from the ground, it will load them onto a modified Boeing 747 mothership, fly them aloft, and then propel them into space from the air.
Despite the catching up of market leader Rocket Lab, some analysts see Virgin Orbit as “a pioneer” in the market for launching small satellites.
After all, Virgin Orbit’s method of accessing space promises several advantages over ground launches. On the one hand, it’s cheap – estimated at around $ 10-12 million to launch a 500-kilogram payload into low Earth orbit. For another thing, it’s flexible. Because an aircraft can theoretically fly to any point on Earth before launching its payload and head in any direction it wants once it gets there, it can essentially target any orbital path it wants. by a client.
And, because an aircraft is not tied to any particular airport, it can avoid launch delays due to bad weather, incursions within launch range (so-called “capricious planes” and “capricious boats” which wander dangerously close to the trajectory rocket flight), or other obstacles. If an airport departure proves inappropriate, Virgin Orbit’s “Cosmic Girl” mothership could simply fly to another airport, refuel and take off from there before releasing its rocket.
… and meet the next space unicorn
Benefits like these may explain why investors value Virgin Orbit so much. The company’s next funding round, which is expected to end before the end of this year, aims to raise “between $ 150 million and $ 200 million” by offering shares valuing the company at “around $ 1 billion”, report The Wall Street Journal.
By selling those shares, Branson will part with a 15% to 20% stake in his company, in exchange for raising the cash Virgin Orbit needs to make its first test flight in space (its first to success flight, i.e. its first launch attempt in May ended in an abortion) and start the commercial launch.
In doing so, he will also introduce Virgin Orbit to the Unicorn Club. By the time Virgin Orbit is ready to conduct its own IPO, it should be able to raise even more money by selling shares to the public at an even higher price – developing its warlord, to better compete. with his fellow space unicorns. Rocket Lab and SpaceX.
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