Joby Aviation continues to impress with a consistent slew of positive news. With the dynamic JoeBen Bevirt at its helm, the company is viewed as the eVTOL market leader, the pioneer of this new industry. It flies the flag for the future of electric air travel and along with EHang looks set to be the first to pass the chequered flag with full certification and the promise of commercial flights in 2024.
It is of no surprise, the stock market is waking up to Joby Aviation’s potential and is being taken seriously by even those once sceptical of this nascent industry and its future promise.
A former doom-mongerer, seekingalpha.com, has changed its tune, for example. Being one of the leading and more respected financial websites, it has published several upbeat articles recently lauding the merits of the company as a long-term BUY.
Last week a journalist from Investor Trip, posted a story on the site, praising Joby’s “first mover advantage, world-class engineering team and USD1.2 billion cash reserves.” It continues, “The eVTOL market is set to explode in growth and Joby remains my favourite overall eVTOL stock.”
What has helped, some might suggest, a tangible fervour surrounding Joby is that last week the company received the crucial FAA Part 135 certificate which allows the company to operate commercial flights. Joby was awarded the certification ahead of schedule, with completion of the process originally expected in the second half of this year. And this coming after the FAA has modified its certification rules, where some elements of the aviation media warned, perhaps wrongly, this would make it more difficult for eVTOL companies to gain such acceptance.
Bonny Simi, the company’s Head of Air Operations and People, and one of Joby’s FAA-approved pilots, commented, “Over the coming months, we will use our Part 135 certificate to exercise the operations and customer technology platforms that will underpin our multi-modal ride-sharing service, while also refining our procedures to ensure seamless journeys for our customers.”
The Part 135 Air Carrier Certificate is one of three FAA approvals required for Joby to operate its eVTOL aircraft as an air taxi service in cities and communities across the U.S, alongside the Type and Production Certificates. Once Joby receives the former, the company will complete the FAA review process to add the new aircraft type to its existing air carrier certificate.
Add to this the accolade that Joby is to be included in the Russell 3000 after the market close on June 24th – the index tracks the performance of the 3,000 largest U.S-traded stocks, which collectively account for around 97 percent of all U.S-incorporated equities – the present lowly share price of USD5.09 (June 6th), down 49 percent from its initial USD10 opening level last August, some might say this would be a good time to buy for a long-term hold.
Back to that seeking alpha article.
The journalist writes, “I truly believe the eVTOL industry will be a complete game changer.” This enthusiasm is such that Joby is then compared to the meteoric share price rise of Tesla. “You could have made a fortune by investing in Tesla during the early days and holding onto your shares.”
Such giddy heights of exuberance is then tempered with concerns surrounding the present eVTOL industry hype. “I’ve personally spoken with many people about the growth of eVTOLs, yet no one feels comfortable riding in an electric aircraft. It may take longer for consumers to adopt them, but I do believe everyone will become obsessed with electric aircraft over the next few decades.”
JoeBen Bevirt Celebrating Joby’s Inclusion on the New York Stock Exchange (August ’21)
The article then points out the impending major competition. “Several eVTOL companies will most likely fail within the next 5 years due to running out of cash or simply failing to receive the proper FAA certifications.” Explaining there is a chance, however small, that Joby “could risk going bankrupt if the company depletes its cash reserves before launching a commercial service in 2024.”
If, for example, Joby cannot obtain the crucial type and production certificates, then the company won’t be able to generate any revenue and would lose all of its potential long-term value. This seems unlikely though, given the huge amount of investment big business has invested in the eVTOL industry as a whole.
The journo concludes, “Joby Aviation reminds me of Tesla in 2010 when it was an obscure company being backed by a bright-eyed eccentric leader named Elon Musk. I see many similarities in Joby Aviation and a similar level of passion and drive in JoeBen Bevirt.”
Behind such bullish enthusiasm there often lies a reason. In this case, the writer is honest enough to state, “Joby stock makes up 14 percent of my growth stock portfolio and I plan to buy more shares leading up to the 2024 commercial launch.”
(Do your own research and due diligence before purchasing any stock)
(Pics: Joby Aviation)