Virgin Galactic slides 10% as investors look to sell 113 million shares

spaceshiptwo unity first free flight new mexico spaceport america runway landing virgin galactic may 2020 — Virgin Galactic's SpaceShipTwo "Unity" lands on a runway at Spaceport America in New Mexico on May 1, 2020.
Virgin Galactic

Virgin Galactic fell as much as 10.2% in early Friday trading after shareholders filed to sell up to 113 million shares.
Shareholders aim to sell up to roughly 105 million outstanding shares of common stock and up to 8 million shares of common stock issuable upon the exercise of warrants, according to a Securities and Exchange Commission filing published Thursday.
The filing doesn't specify when the selling could begin.
The filing comes as shares sit roughly 120% higher year-to-date.
Watch Virgin Galactic trade live here.

Virgin Galactic tumbled as much as 10.2% in early Friday trading after shareholders moved to sell up to 113 million shares.

In a Securities and Exchange Commission filing published Thursday, stockholders announced efforts to resell up to about 105 million outstanding shares of common stock and up to 8 million shares of common stock issuable upon the exercise of warrants. Virgin Galactic won't receive any of the proceeds from the sale. The filing doesn't specify when the selling could begin.

The resale efforts come as Virgin Galactic shares sit about 120% higher year-to-date.

Shares recently weathered stronger volatility as the company prepares for its first manned test flight out of Spaceport America in New Mexico. The stock rallied to a 9-month high on December 7 as investors bet on a successful test, but rocket engine issues postponed the flight and dragged shares as much as 17% lower on December 14.

"Virgin Galactic is now conducting post-flight analysis and can so far report that the onboard computer which monitors the propulsion system lost connection, triggering a fail-safe scenario that intentionally halted ignition of the rocket motor," the company said in a statement.

It's unclear when the test flight will be rescheduled. The initial plans to hold the test in November were already delayed once after rising COVID-19 cases in New Mexico squandered launch efforts.

Virgin Galactic closed at $25.50 on Thursday. The company has five "buy" ratings and four "hold" ratings from analysts, with a consensus price target of $24.56.

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