Here’s why Virgin Galactic stock jumped 40% on Friday

Virgin Galactic Holdings Inc (NYSE: SPCE) gained roughly 40% in the stock market on Friday as the U.S. Federal Aviation Administration gave the green light to billionaire Richard Branson’s spaceflight company to fly people to space. The announcement raises pressure on space-tourism competitors, including Jeff Bezos’ Blue Origin and Elon Musk’s SpaceX.

Virgin Galactic’s spaceflight costs $250,000

The news comes about a month after Virgin Galactic’s first successful human test flight from New Mexico. According to the British-American company, ticket for its 90-minute flight costs $250,000 and offers weightlessness experience that lasts for several minutes. More than 600 customers have so far reserved a seat on its flights.

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Virgin Galactic is now scheduled for its first fully crewed test flight this summer. The final development testing phase has three space flights remaining, one of which will take founder Richard Branson to space.

Branson vs Bezos: Who will be the first to go to space?

Following the announcement, many are now wondering who will be the first one to go to space; Richard Branson or Jeff Bezos. Commenting on that, CNBC’s Michael Sheetz said on “Closing Bell:

“Virgin Galactic’s next spaceflight test was supposed to be one with four members in the cabin to test the cabin experience, and then the second one was going to be Branson’s. There’s been talk about pulling Branson’s flight up. But the biggest thing right now is deciding whether they can get this spacecraft turned around in time for the next spaceflight. Historically, the average turnaround time is somewhere in the ballpark of sixty days. That puts you past the July 20^th date that Jeff Bezos is targeting.”

The FAA approval was particularly a huge news for Virgin Galactic after a rough month in which Cathie Wood sold her entire stake in SPCE, and Kerrisdale Capital said it pretends to be a space-tourism company but has technology that is costly, uncompetitive, unappealing, and downright ‘dead end’.

Virgin Galactic closed the regular session on Friday at about $56 per share – only slightly down compared to its record $59.41 per share. In comparison, it had tanked to a low of roughly $16 per share in mid-May. At the time of writing, Virgin Galactic is valued at $13.42 billion.