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Virgin Galactic drops 10% in regular trading, unwinding premarket rally after Richard Branson’s successful space flight

Richard Branson poses with the new SpaceShipTwo, a six-passenger two-pilot vehicle meant to ferry people into space, in Mojave, California,February 19, 2016.

  • Virgin Galactic dropped by as much as 10% as markets opened on Monday, unwinding pre-market gains.
  • The company successfully completed a space flight with founder Richard Branson over the weekend.
  • Branson thereby beat rival entrepreneurs Jeff Bezos and Elon Musk to be the first billionaire to reach space.
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Shares of Virgin Galactic dropped by as much as 10% as markets opened on Monday after the space company completed a successful space test flight with founder Richard Branson on board over the weekend.

This was the first time Virgin Galactic flew a full crew to the edge of outer space in its VSS Unity spacecraft, which reached 55 miles above sea level.

As markets opened on Monday, shares of Virgin Galactic dropped as much as 10%. They were last at $44.80, down 9.76% at 9:42 am E.T., after having risen by as much as 9% in pre-market trading.

Last week, UBS analyst Myles Walton downgraded Virgin Galactic to “neutral” as he believed the majority of optimism around achieving space travel was already considered in the current stock price and it could therefore not skyrocket further. The company has soared almost 200% since mid-May.

With the successful space flight, Branson beat fellow space company founder Jeff Bezos into space by just over a week – the Blue Origin founder is due to fly on July 20 on the New Shepard rocket. Blue Origin’s CEO Bob Smith had played this down earlier in the month, saying that Bezos’ flight would go higher than Branson’s and break through the Kármán line – a heavily contested, imaginary boundary used by some space experts to determine the end of Earth’s atmosphere and beginning of outer space.

Virgin Galactic secured approval from the Federal Aviation Administration to fly customers into space last month, becoming the first company to do so. Over 600 customers are waiting for a spaceflight, including billionaire and CEO of space technology company SpaceX, Elon Musk. Tickets for space flights with Virgin Galactic cost $250,000.

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