Sir Richard Branson’s hour-long flight on Virgin Galactic’s (NYSE:SPCE) SpaceShipTwo on Sunday could herald new heights for commercial space flight companies. Shares of the Las Cruces, New Mexico-based company are heading into the new trading week more than 7% higher, more than regaining Friday’s 6.62% decline in SPCE stock. Importantly, other space stocks are joining SPCE in this celebration.
Shares of AST SpaceMobile (NASDAQ:ASTS) are leading the group, up 9.2% in pre-market trading, followed by Astra Space (NASDAQ:ASTR). Rocket Lab merger partner Vector Acquisition (NASDAQ:VACQ) is also up 2.7% at 7:30 a.m. Eastern.
The weekend flight was the 22nd test flight of VSS Unity and the first test flight with a full crew in the cabin, including founder Branson. Unity achieved a speed of Mach 3 after being released from the mothership, VMS Eve. The vehicle reached an altitude of 53.5 miles before gliding to a runway landing at Spaceport America.
“Today is a landmark achievement for the Company and a historic moment for the new commercial space industry,” Michael Colglazier, CEO of Virgin Galactic, said following the flight.
Space Stocks Got Boost From Thematic Investing
We are amid the second Space Race. The first space race involved countries fighting to see who could get to the moon first. This race involves companies fueled by investors fighting to see who can commercialize space first.
Space stocks have seen investor interest increase thanks to trends in thematic investing, namely moves by the closely watched fund manager Cathie Wood and ARK Invest. Earlier this year, the ARK Space Exploration & Innovation ETF (BATS:ARKX) attracted more than a billion dollars in new investor money within a month after its March 30 launch.
While that exchange-traded fund and its sibling ARK Autonomous Technology & Robotics ETF (BATS:ARKQ) both held SPCE stock, the holdings were sold in late May after the share price popped ahead of Virgin Galactic’s third test flight.
“Thematic ETF investing is often open to interpretation, and so, the way that Ark describes its space ETF includes companies that will benefit from aerospace activities or technologies used to support aerospace,” Todd Rosenbluth, senior director of ETF and mutual fund research at CFRA Research, told CNBC in April.
On the date of publication, Robert Lakin did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
InvestorPlace contributor Robert Lakin is a veteran financial writer and editor, including previous stints with Bloomberg News and as a buyside equity research editor. His Substack newsletter, TLV Strategist, covers the Israel business scene.
