Firefly Posts Widening Losses After Rocket Mishap. The Stock Is Losing Its Buzz After a Big IPO

• Firefly’s stock plunged Tuesday after the aerospace company’s first earnings report since going public last month revealed widening losses.

• The stock had popped on its first day of trading, but enthusiasm has waned since, with recent losses dragging the shares below their IPO price.

Firefly Aerospace (FLY) shares tumbled Tuesday, a day after the aerospace firm posted widening losses, as a mishap that grounded its Alpha rocket weighed on its results.

The stock was down nearly 12% in recent trading around $43. Monday’s quarterly report was the company’s first since it went public last month, with Tuesday’s drop dragging the stock below its initial public offering price of $45 per share.

Firefly’s debut was among a series of recent $100 million-plus IPOs that popped on their first day of trading, widely interpreted as a sign of renewed investor appetites for new stocks. However, its waning popularity since underlines how quickly new stocks can fall from favor as more information about the company becomes publicly available. New stocks can be volatile, and investors should consider this risk when evaluating adding new listings to their portfolios.

Firefly reported a second-quarter loss of $80.3 million, or $5.78 per share. That compares to a loss of $58.7 million or $4.60 per share a year ago.

The Federal Aviation Administration had halted launches of Firefly’s Alpha rocket following a rupture during a late April flight that led the Alpha Flight 6 to fail to reach orbit and fall into the ocean. Following an investigation, the FAA last month allowed the company to resume Alpha missions.

CEO Jason Kim said in a call with analysts that Firefly has made changes to Alpha to address the issue, and “is now working to determine the next available launch window for Alpha Flight 7,” according to a transcript provided by AlphaSense.

The company also said it received a $10 million contract addendum from the National Aeronautics and Space Administration related to Firefly’s Blue Ghost lunar mission. Blue Ghost was the first commercial spacecraft to land on the moon, and the addendum will have the company provide NASA with more data collected from that trip.

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