Sir Richard Branson (founder of Virgin Galactic) on the New York Stock Exchange floor on October 28, 2019. Drew Angerer/Getty Images
Virgin Galactic fell after the FAA declared that their flights were grounded pending investigation.
The agency stated that Virgin Galactic could not send the SpaceShipTwo vessel to flight until the FAA has approved the final investigation report.
After a New Yorker article detailing the difficulties of spaceflight, news about the mishap emerged.
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Virgin Galactic shares tumbled after the Federal Aviation Administration announced Thursday that Virgin Galactic's flights were grounded pending investigation into an accident during Sir Richard Branson’s July space trip.
Virgin Galactic's stock fell 7.26% Thursday to $24.85.
The federal agency informed Insider via email that Virgin Galactic might not allow the SpaceShipTwo to fly until the FAA approves the final report on the mishap or determines that the issues related to it do not threaten public safety.
The FAA is responsible to protect the public during commercial launch and reentry operations.
According to the agency, Virgin Galactic's SpaceShipTwo did not comply with its Air Traffic Control clearance when it returned from Spaceport America. It is currently investigating the July 11, incident.
The New Yorker published a piece detailing the mishap that Branson experienced during his spaceflight.
It reported that the plane did not take off steeply enough to reach space, which caused it to depart from its prescribed flight path when it returned to Earth. The New Yorker reports that while the pilots, Mike Masucci and Dave Mackay, were able correct the error and safely land, they flew out of their airspace clearance zones for 1 minute and 41 seconds.
Insider was told by Virgin Galactic that the New Yorker report was misleading.
The shares of the aerospace company have fluctuated wildly over the past twelve months, with some jumping as high as $62.80 and others sinking as low at $14.27.
Jefferies still has a 12-month price target for $33 on the stock. This is a 23% increase from Tuesday's close price of $26.79.
