Special Bulletin - Virgin Galactic (SPCE)
In recent days, several stocks recommended by Cabot analysts have rocketed to new highs, propelled by the twin forces of social media and short-covering, and our Virgin Galactic (SPCE) is one of them.
Long-term, I remain very bullish on this company, optimistic that its pioneering work on space tourism will revolutionize the space travel sector in the same way that Tesla (TSLA) has revolutionized the automobile sector.
But short term, the stock seems crazy-high to me and I think the odds are very good that a substantial downturn is imminent. Thus I recommend some partial profit-taking here for most readers.
Yes, it’s possible that the stock will climb higher; it’s very hard to call tops. But the goal is not to buy at bottoms and sell at tops. The goal is to make money while managing risk, and I think taking partial profits in SPCE now is a great way to reduce your risk.
Whether you sell at the market or use stops is up to you. Both methods have their pros and cons.
Your next full issue will be published next Monday, February 1.