Houston, we have a problemRocket launch service Astra Space hits a snag in its latest NASA venture, and prices nosedive.
- Astra had a “failure to launch” moment on Thursday. It was on a NASA-funded mission to deliver a set of four satellites to orbit, and despite making it off the launch pad, Astra confirmed mid-flight that there was a technical issue that prevented it from reaching its destination.
- It comes three months after its first successful orbital launch and only six years after it was founded in 2016, so it’s working on a much quicker timeline than many other space companies. It looks like Astra has a way to go before reaching its target of one rocket launch a day by 2025.
- The stock hurtled down over 26% to its lowest price ever, now down 61% since it started trading in July 2021 – weakness across the Nasdaq (NDX) may have worsened the losses, but investors clearly aren't happy.
Starstruck by first flightCalifornian-based Astra rides its first successful rocket launch all the way up to five-month highs on Monday.
- Astra rocketed 42% after becoming one of only four U.S. firms to see a rocket successfully reach orbit, and even Elon Musk is impressed. It joins Virgin Galactic, SpaceX, and RocketLabs in the skies.
- Astra listed through a SPAC in July but the stock got pummeled in August after its previous attempt crashed and burned (literally).
- Commercial operations on the rocket start soon, and another launch is scheduled for next year.
Profit-taking pulls Astra back to earthJust five days after Astra Space completed its SPAC to join Virgin Galactic as one of the few publicly listed space companies, its shares are getting pulled back down to earth with a drop of 20%.
The stock market welcomed its first rocket company last Thursday, but it's not any of the headline grabbing billionaire pet projects you’re used to hearing about, like SpaceX or Blue Origin. It’s actually a small start-up that only builds one, rather small, 38-foot tall rocket (for comparison, SpaceX’s Heavy Falcon rocket is 230 foot tall). But according to Astra it’s not what you’ve got… it’s how you use it.
We’re seeing hundreds of companies that want to get from anywhere on Earth to anywhere in space on their schedule — not wait years to get a lot of things to one place. So we’re really focused on building a much smaller rocket, produced in much higher volume, launched from a much larger number of locations,
explained Astra CEO Chris Kemp.
Astra Space merged last week with special acquisition company Holicity, which is backed by Bill Gates among other big dog investors, in a deal that valued the space company at $2.1 billion. The firm has been around since 2016, and in December it became the latest rocket builder to reach space after the successful launch of its Rocket 3.2 from Alaska. The rocket builder raised $100 million in capital before the SPAC, which is itself expected to raise a modest $500 million in cash proceeds.
Astra hopes to begin commercial service of its rocket business this summer, with monthly launches expected by the end of 2021, and daily launches by 2025. But it’s entering a pretty packed market. Though a lot of the well known large rocket makers are still private, SPACs have opened up a whole new world for space companies wanting to go public – it’s estimated that there are over 100 start-ups in the space industry in various stages of small rocket development that could make use of this listing method in the near future.
Virgin Galactic (SPCE) is one of the few private space companies that has already successfully made the public journey – and it’s worked out pretty well for Richard Branson, who still owns a 24% stake. SPCE Prices started trading at $12.34 in October 2019 and are currently sitting around the $45 mark. But competitors are jostling in the wings. Virgin Galactic's sister company Virgin Orbit is already considering a SPAC listing, and there are many others on the way. Momentus Space, which is aiming to find a way for human existence to flourish in outer space, is going public via a reverse merger later this year, while small rocket maker Rocket Labs is due to launch with a SPAC soon; and space infrastructure conglomerate Redwire Space is also preparing to go public. So there will soon be plenty of options for space enthusiasts to choose from.
To Astra’s advantage, the timing of its recent listing lines up well with Richard Branson’s impending trip to space on July 11, which is likely to give all space companies a boost.
Astra Shares lifted a modest 4.45% on its first day of trading, and a further 20% on Monday, before Tuesday saw the afterglow wear off and some enthusiastic profit taking caused prices to tumble. However, as of today the stock price still sits 14% higher than where it entered on Thursday, so it looks as if the firm is still in orbit. Just.