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posted by janrinok on Saturday January 22 2022, @02:23PM   Printer-friendly
from the no-longer-"Virgin" dept.

Rocket Report: Virgin Galactic's stock crash:

Financial trade publications are starting to raise serious questions about the valuation of Virgin Galactic, which became publicly traded in 2019 via a special-purpose acquisition company [SPAC]. The latest issue involves the company's plans to raise up to $425 million of convertible debt, which essentially allows Virgin Galactic to receive a lower interest rate on debt in exchange for a fixed price on stock shares. The Financial Times explains more here. Apparently, the terms of this deal (the financial wizardry of which is beyond the capacities of a simple space writer) were adverse for existing shareholders.

Publications have also started to take note of the stark disconnect between Virgin Galactic's projections at the time it went SPAC in 2019 and where it is today. For example, Virgin Galactic forecast $398 million in revenues in calendar year 2022, whereas analysts now expect it to bring in $7.9 million. "Let's just hope their aerospace engineering is a touch more precise than their financial engineering. For their customers' sake," the Financial Times says snarkily. Virgin Galactic's stock has fallen from a high of $59.41 in February 2021 to less than $10 today.

Virgin Orbit's [note: not Virgin Galactic] LauncherOne rocket lofted seven small satellites for three different customers on January 13, Space.com reports. This marks the third straight successful mission for the California-based company. LauncherOne flew for the first time in May 2020 on a test flight that carried no satellites. That launch failed after a fuel line in the rocket's first-stage engine ruptured.

Since then, Virgin Orbit's next three flights have all gone orbital. For a company just starting to launch rockets, one launch every six months is an impressive cadence. This month's flight really helps to establish LauncherOne's status as a reasonably timely and reliable small-satellite rocket.


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  • (Score: 3, Insightful) by bzipitidoo on Saturday January 22 2022, @06:58PM (6 children)

    by bzipitidoo (4388) on Saturday January 22 2022, @06:58PM (#1214840) Journal

    Financial wizardry? More like financial skulduggery.

    Excessive complexity has several nefarious uses. It's not just making it hard to figure things out. It's also fatigue, so that people don't want to even try. They'll excuse themselves with stuff like "beyond the capacities of a simple" whatever. Though that's meant snarkily, expressing suspicions that there is something rotten about a deal, they nevertheless run from all the work involved in taking a hard look. And why should anyone have to spend valuable time on such bull? Typical of US medical billing. Don't know how much the new "no surprise (medical) bills" law will help. Hopefully medical providers will not be able to weasel around the intent. A common trick for surgery has been to use an out-of-network anesthesiologist, then surprise the patient with a huge bill for that portion of the work, which the insurance (if any) has refused, probably rightly.

    As to this whole SPAC thing, wonder if that's going to turn out like the infamous CDOs? I expect there's sufficient ambiguity about it that no one can say with certainty that it's a ripoff. Yes, if all the pie-in-the-sky magical thinking works, if everything goes the way these schemers assure everyone it will, then, yeah, the SPAC will be a great idea for all. Yes, if Theranos had been able to deliver on their promises, it would've been a great investment.

    Another sign that a company is unable to deliver is a turn towards financial trickery. You know, like Enron. Or litigation, like the SCO Group.

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  • (Score: 2) by crafoo on Saturday January 22 2022, @07:47PM (2 children)

    by crafoo (6639) on Saturday January 22 2022, @07:47PM (#1214854)

    A common trick for surgery has been to use an out-of-network anesthesiologist, then surprise the patient with a huge bill for that portion of the work, which the insurance (if any) has refused, probably rightly.

    Yep. I Had that exact thing happen to me. The bill was quite a shock. I thought I was dreaming for a second or two.

    • (Score: 2) by bzipitidoo on Saturday January 22 2022, @10:29PM (1 child)

      by bzipitidoo (4388) on Saturday January 22 2022, @10:29PM (#1214869) Journal

      Yeah, technically, if there is good reason to have employed an out-of-network anesthesiologist, health insurance is supposed to pay that. Practically fraudulent to drag the patient into that dispute. But then, the surgeons were not supposed to bring in out-of-network anesthesiologists, and very likely didn't need to.

      • (Score: 2) by Spamalope on Monday January 24 2022, @05:57AM

        by Spamalope (5233) on Monday January 24 2022, @05:57AM (#1215207) Homepage

        And a detail neither tells the patient: The 'in network agreement' for the Doctor and Hospital prohibits bringing in undisclosed 3rd parties. So the anesthesiologist is a result of a violated contract. Twist I experienced: anesthesiologist claims to be in network; insurance reports in network; after procedure 'well, they're in network but not for your plan'. Price difference? $250 co-pay to $25,000 bill via 100x magic pricing.

  • (Score: 0) by Anonymous Coward on Saturday January 22 2022, @08:14PM (2 children)

    by Anonymous Coward on Saturday January 22 2022, @08:14PM (#1214860)

    Oh the surprise medical bills... they kept calling me, as an emergency contact, about my mother's anasthesia bill for 5 years afyer she died.

    • (Score: 3, Informative) by bzipitidoo on Saturday January 22 2022, @10:23PM

      by bzipitidoo (4388) on Saturday January 22 2022, @10:23PM (#1214868) Journal

      5 years? That was debt collectors harassing you. Medics have long since sold the debt. Don't try to explain, debt collectors don't care about anything except money. Don't care that it's a mistake, the wrong person, whatever. If the debt collectors listen, it's only to feed you rope to hang yourself with, hoping you'll say something they can use against you. Just tell them you're not paying. And not to call you any more. They may try to hang up on you real fast before you can tell them not to call, so they can keep harassing you because you didn't tell them to stop.

      They might also threaten to sue, ruin your credit rating, etc. Mostly empty threats, especially the credit rating destruction since the rating agencies decided, a few years ago now, to classify medical debt differently from all other debt. And on that, one thing NOT to do is agree to anything that lets the debt collector transform a medical debt into a standard debt. Don't agree to anything at all. Try not to even say the word "yes", they just might try to construe that as agreeing to something rather than a simple acknowledgment.

    • (Score: 0) by Anonymous Coward on Sunday January 23 2022, @11:19PM

      by Anonymous Coward on Sunday January 23 2022, @11:19PM (#1215139)

      Call a consumer protection attorney. You might just get a bunch of statutory damages for violating the Fair Debt Collection Practices Act.