Legendary U.S Investor Cathie Wood Buys More Joby Aviation Shares
There May Be Trouble Ahead, but legendary stock market investor, Cathie Wood, continues to believe in the nascent eVTOL industry, by recently doubling her share position in Joby Aviation, reports bharatexpressnews.com.
The 67 year-old American Founder and CEO of Ark Invest who was named the best stock picker of 2020 by Bloomberg News and a year later included in Forbes ‘Top 50 over 50’ of entrepreneurs, leaders, scientists and creators, has two investment arms, ARKQ (ARK Autonomous Technology & Robotics ETF) and ARKX (ARK Space Exploration & Innovation ETF).
Cathie Wood
Today, Wood is not shy of warning investors there is a hard landing ahead for the U.S economy due to the Fed’s present policy of aggressive rate hikes. She explains, “The velocity of money is levelling off,” referring to the recent banking meltdown and Wood expects “a marked slowdown in nominal gross domestic product.”
Even so, while other traders are moving into defensive stocks, Wood’s continued belief in tech shares, which have been badly hit in recent times, allows her to face the music and dance regardless of the macro background. In this case, picking up, in her view, bargains priced at under USD5 a share. Wood is well-known to favour advanced disruptor companies, so her recent buying focus on Joby does not come as a surprise.
In mid-February, the company announced that final assembly of its first eVTOL-compliant (and piloted) aircraft had begun at its pilot plant in Marina, California. Joby expects to be the first company to build a compliant eVTOL aircraft. Test flights are expected to begin soon. And earlier in February, the company said it had completed Phase 2 (of 5) needed to achieve FAA certification, making it the first eVTOL company to reach this milestone and moving it one step closer to its goal of launching a commercial passenger service by 2025.
This recent positive news prompted Wood to purchase 574,301 shares through ARKQ and ARKX. Her total holdings now stand at 447,648 shares via ARKQ and 1,286,772 shares through ARKX. Combined, these are now worth around USD6.6 million.
Wood’s optimism is echoed by Cantor analyst Andres Sheppard, who believes Joby is on track to achieve its goals.
He commented, “We remain optimistic about Joby for the long term and are encouraged by the company’s progress towards achieving FAA certification and commercialisation in 2025. We are also encouraged by Acting FAA Administrator Billy Nolen’s recent visit to Joby’s HQ. We believe this is indicative of regulatory support in helping bring the aircraft to market.”
Sheppard continued, “More importantly, we believe Joby has a very strong liquidity position with USD1.1 billion in total liquidity (as of 4Q), which we believe is not only the highest in the industry, but also enough to drive the business through both certification and commercialisation.”
On the back of this, Sheppard rates Joby as Overweight (i.e. Buy), along with a USD9 price target. If that figure is met, investors who buy shares now, may pocket big gains of 130 percent or more.
While others from Wall Street are not so optimistic, (the stock has a 2 Buy, 1 Hold and 1 Sell consensus rating), the bulls remain very bullish, where the USD7.67 average target suggests the stock could rise close to 100 percent higher in the coming months.
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(News Source: https://thebharatexpressnews.com/)
