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What's in Store for Virgin Galactic's (SPCE) Q4 Earnings?

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Virgin Galactic Holdings, Inc. (SPCE - Free Report) is scheduled to release fourth-quarter 2020 results on Feb 25, after market close. In the last reported quarter, the company delivered a negative earnings surprise of 25.93%.

In the trailing four quarters, Virgin Galactic came up with a negative earnings surprise of 16.54%, on average.

Let's take a closer look at the factors influencing the company’s upcoming results.

Factors at Play

Earlier in 2020, Virgin Galactic announced its expectations of witnessing minimal revenues for the remainder of 2020 due to its shift in focus to execute test flight programs and ensure the safety of its workforce, given the challenges associated with the prolonged COVID-19 pandemic. We expect the upcoming results to duly reflect the aforementioned trend.

However, during the third-quarter earnings call, the company revealed modest revenue expectations related to payloads during the fourth quarter. So, we may expect its upcoming results to reflect payload revenue growth on account of such projections.

During the fourth quarter, the company is expected to have incurred escalated expenses due to the prolonged economic impact of the COVID-19 pandemic on the company's operations. Further, it has been witnessing a rise in vehicle tooling costs in recent times, as it continues to prepare some of its facilities for commercial operations. Moreover, the company has been experiencing ongoing delays to its business and operations, also due to COVID-19, which has led to accumulated impacts on both schedule and cost efficiency. This trend is expected to have continued through the fourth quarter.

These aforementioned factors might have adversely impacted the company’s bottom-line performance during the soon-to-be-reported quarter.

Earnings Whispers

Our proven model predicts an earnings beat for Virgin Galactic this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat.

Earnings ESP: Virgin Galactic has an Earnings ESP of +9.68%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: The company carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Virgin Galactic Holdings, Inc. Price and EPS Surprise

Recent Defense Releases

Lockheed Martin Corp. (LMT - Free Report) reported fourth-quarter 2020 earnings from continuing operations of $6.38 per share, which came in line with the Zacks Consensus Estimate.

Hexcel Corporation (HXL - Free Report) reported fourth-quarter 2020 loss of 18 cents per share, in line with the Zacks Consensus Estimate.

General Dynamics Corp. (GD - Free Report) reported fourth-quarter 2020 earnings from continuing operations of $3.49 per share, which missed the Zacks Consensus Estimate of $3.55 by 1.7%.

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