Joby Aviation stock price remains in a deep bear market this year as investors wait for more details about its commercialization strategy. After initially soaring to a high of $10.73 on January 7, the stock has retreated by over 40% to the current $6.25. So, is JOBY a good eVTOL stock to buy and hold this year?
Joby is gearing for a big year
Joby Aviation, a top company in the electric vertical takeoff and landing (eVTOL) industry, is gearing for an important year. It will continue with its certification process in the United States and other countries.
The company hopes that its first aircraft, which has a capacity of four passengers and a pilot, will receive all the certificates it needs to operate its business. In the future, it hopes that it will start selling its aircraft to operators and to also run its air taxi business.
Joby is also working on partnerships ahead of its commercialization. It recently partnered with Virgin to launch its services in the UK once the commercialization phase starts, either later this year or in 2026. It has also inked partnerships with other airlines like United and Southwest.
Joby Aviation is also working to grow its business in Dubai, building its vertiports, where the aircraft will land and take off in the city. At the same time, the company is planning to start its commercial services in the United States, initially in New York and California either later this year or in 2026.
The company has already intensified its partnership with the Department of Defense (DoD), where it has delivered five aircraft, including a hybrid hydrogen one. This hydrogen aircraft has flown for over 600 miles.
Read more: JOBY vs Archer Aviation: Which is a better eVTOL stock to buy?
Cash burn continues
The biggest challenge for Joby Aviation is that it is still not making money and is instead burning substantial sums of money.
Its most recent results showed that the company’s flight services revenue made just $55,000 in the fourth quarter and $136,000 in the whole of last year.
However, its robust research and development (R&D) and its selling, general, and administrative (SG&A) expenses pushed its quarterly loss to $246 million and its annual figure to $608 million.
This loss-making trend will continue this year, eroding its cash balances. On the positive side, it ended the last quarter with over $932 million in cash and short-term investments, a drop from the $1 billion it had a year earlier.
Therefore, the company will likely need to raise money again later this year, which will dilute its existing shareholders. These investors have been diluted before as its outstanding shares have jumped to 784 million, up from 604 million after its SPAC listing.
Joby Aviation stock price analysis
JOBY chart by TradingView
The weekly chart shows that the JOBY stock price bottomed at $5 this week. This is a notable level since it was along the ascending trendline that connects the lowest swings since December 2022.
The stock has moved slightly above the first support level of the Woodie pivot points. It has also formed a bullish engulfing pattern. Therefore, technicals suggest that the Joby Aviation share price will continue rising as bulls target the Woodie pivot point at $7.60, which has coincided with the highest point in July 2024 and December last year.
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