Why Is Virgin Galactic (SPCE) Stock Surging Tuesday?

Virgin Galactic Holdings Inc. (NYSE:SPCE) shares are trading higher Tuesday morning. Investors are reacting to the company’s latest quarterly financial results.

Earnings Beat Estimates

After the closing bell Monday, the aerospace firm reported a fourth-quarter loss of 98 cents per share. This figure beat analyst estimates for a loss of $1.05 per share. However, revenue of $312,000 missed the $495,000 target.

SpaceShip Assembly Progress

CEO Michael Colglazier noted the first new SpaceShip is nearly complete. Ground testing will begin in April. The company has released limited Spaceflight Expeditions priced at $750,000 each.

“We continue to strategically manage our capital to support our planned ramp in cash flow,” Colglazier said.

High Short Interest

Short interest in Virgin Galactic recently rose from 15.40 million to 16.94 million shares. Currently, 23.19% of the float is held short. Data shows it would take 10.54 days for short sellers to cover their positions.

Technical Analysis

Virgin Galactic is trading 3.6% below its 20-day SMA and 21.9% below its 100-day SMA, keeping the stock technically “below trend” on both the short- and intermediate-term timeframes. Shares are down 28.38% over the past 12 months and are positioned closer to their 52-week lows than highs.

Momentum gauges are still cautious: RSI is at 33.93, which sits in neutral territory but leans toward the “washed out” side of the range after the oversold reading on February 5. MACD is at -0.0915 and remains below its signal line at -0.0712, a bearish configuration that suggests rallies may still face selling pressure.

The combination of RSI below 50 and bearish MACD suggests mixed momentum.

• Key Resistance: $2.50
• Key Support: $2.00

SPCE Price Action: Virgin Galactic shares were up 7.83% at $2.34 during premarket trading on Tuesday, according to Benzinga Pro data.

Photo by T. Schneider via Shutterstock