Vertical Aerospace: “Time to Buy This Game-Changing eVTOL Stock?”

Mic­ah Angel, a con­trib­u­tor for the finan­cial web­site, The Mot­ley Fool, post­ed an arti­cle about Ver­ti­cal Aero­space (EVTL) ear­li­er this week, which was then picked up and repub­lished by more than 15 dif­fer­ent online sites. Angel asks that evok­ing ques­tion: Has the time come to invest in Ver­ti­cal Aero­space (VA)?

Any­one who attend­ed July’s Farn­bor­ough Air­show and vis­it­ed VAs trade stand would have been high­ly impressed by the full-scale VX4 on dis­play. So much so, that the share price rose 20 per­cent on the back of favourable media reviews. Since, the price has fall­en back. Unfor­tu­nate­ly, shares for all eVTOL com­pa­nies on the Stock Mar­ket have been in the dol­drums for much of this year.

Mic­ah Angel

Angel dis­cuss­es the impor­tance of tim­ing and sup­ports this by news of VAs impend­ing first test flights along­side part­ner­ships with gold-plat­ed glob­al com­pa­nies like Rolls-Royce, Vir­gin Air­lines, Microsoft, Solvay and Hon­ey­well, who offer engi­neer­ing and man­u­fac­tur­ing exper­tise along­side the all-impor­tant fund­ing for R&D.

These col­lab­o­ra­tions pro­vide Ver­ti­cal Aero­space with obvi­ous advan­tages over its rivals. For exam­ple, Hon­ey­well Aero­space, a glob­al pio­neer in avion­ics, builds advanced flight con­trol sys­tems for Ver­ti­cal’s VX4 Air­craft and assists with flight sim­u­la­tion test­ing, while Rolls-Royce offers its exper­tise on propul­sion sys­tems.

Angel writes, “With demand accu­mu­lat­ing, Ver­ti­cal Aero­space’s real work starts now. It will have to prove to the world that its tech is func­tion­al, worth­while, and above all, safe.”

He points out that VA push­es to “not only spear­head an entire­ly new fly­ing taxi mar­ket, but also to dis­rupt and dis­place the exist­ing heli­copter indus­try.” eVTOL improve­ments include bet­ter safe­ty, far less noise, car­bon-free green trav­el and reduced oper­at­ing costs.

Angel remarks the com­pa­ny’s most for­mi­da­ble chal­lenge is prov­ing its air­craft are safe. He says, “Cer­ti­fi­ca­tion stands firm­ly in Ver­ti­cal Aero­space’s crosshairs in the near term. The com­pa­ny will need to demon­strate to reg­u­la­tors that its air­craft meet the high­est glob­al stan­dards of aero­space safe­ty.”

Ini­tial­ly, the com­pa­ny finan­cials look daunt­ing. The cost to design, build, test, and oper­ate air­craft, espe­cial­ly cut­ting-edge ones, is high­ly sig­nif­i­cant. In the first half of this year, VA report­ed a net oper­at­ing loss of UKP39 mil­lion or a 79 per­cent increase from the same peri­od last year with the com­pa­ny expect­ing to spend up to UKP50 mil­lion more by year’s end.

On the pos­i­tive side, Ver­ti­cal has drummed up plen­ty of inter­est for its VX4 with pre-orders com­ing from Amer­i­can Air­lines, Vir­gin Atlantic and Air­craft leas­ing com­pa­ny Avolon. Aside from the pas­sen­ger trav­el busi­ness, VA has also secured pre-orders for uses in emer­gency med­ical and car­go ser­vice indus­tries.

VX4 on Dis­play At Farn­bor­ough Air­show

Due to this, Ver­ti­cal grew its pre-order book to over 1,400 VX4 craft in the sec­ond quar­ter with a total val­ue of USD5.6 bil­lion. While, Amer­i­can Air­lines com­mit­ted to a pre-deliv­ery pay­ment for its first 50 craft on an order that could reach 350 units. Accord­ing to com­pa­ny CEO, Stephen Fitz­patrick, “The out­look for eVTOLs and Ver­ti­cal has nev­er looked bet­ter.” Mean­while, VA has enough cash on hand to con­tin­ue oper­a­tions for at least anoth­er year.

Angel then states the obvi­ous. Invest­ing in Ver­ti­cal is all about the appetite for risk. He writes, “While risk-averse investors might avoid spec­u­la­tive start-ups like this alto­geth­er, those with a high­er risk tol­er­ance, and some patience, could see an invest­ment in Ver­ti­cal Aero­space real­ly take off.” Point­ing out, “Keep in mind that high­er-risk invest­ments such as these can present sig­nif­i­cant­ly more volatil­i­ty than blue chip stocks and also have a much high­er rate of fail­ure.” He goes on, “There­fore, risk-averse investors should wait until the com­pa­ny’s con­cept is proven and its prod­uct tru­ly lives up to the hype.”

Angel ends his arti­cle by cit­ing invest­ment guru, Kevin ‘Mr Won­der­ful’ O’Leary, who once said, “Vision is noth­ing with­out a plan to exe­cute it.” And sug­gests that investors with a longer time hori­zon and an appetite for more risk could live to see a future where air trav­el is far more con­ve­nient than ever before.

He con­cludes, “If Ver­ti­cal Aero­space can exe­cute its plan with min­i­mal delays, this tech stock could ascend to be a leader in the emerg­ing fly­ing taxi mar­ket.”

For more infor­ma­tion

https://vertical-aerospace.com

(News Source: https://www.fool.com)