Flying car stocks are a new phenomenon that could be rewarding to long-term-oriented investors. In fact, Fortune Business Insights suggests the flying car market will grow at an annualized rate of 50.5% until 2040.
Although an early-stage concept, it’s evident that the flying cars industry has systematic support. Nevertheless, early-stage industries are often plagued by growth traps, so I decided to execute a robust screening process to identify the three best-in-class flying car stocks. Methodologically, I emphasized proof of concept, fundamental results, and valuation attributes. Moreover, I included technical analysis whenever necessary.
Flying car stocks are risky and may not be suitable for all investors. However, if your risk appetite aligns with the industry, then here are three flying car stocks to consider.
Joby Aviation (JOBY)
Joby Aviation (NYSE:JOBY) has gained exposure to the vertical take-off and landing space through its electric ride-sharing. The company’s aircraft carries four passengers, can reach 200 miles per hour, and has zero operating emissions. Moreover, Joby’s research and development spans more than ten years, meaning its understanding of the industry is granular, allowing for succinct scalability.
I added Joby to this list as I believe it is gearing up to dominate this industry. The company’s eVTOL air taxi is touted to gain certification and service entry in 2025. However, in the meantime, Joby decided to acquire Xwing, an autonomous flight control systems developer. Xwing’s acquisition provides Joby with early-stage vertical integration, allowing it to tap into cost-saving synergies and scalability. As such, I’m incredibly excited by the company’s prospects, especially from a financial vantage point.
Although it has not reached commercial status, Joby has serviced government-related projects, providing $1 million in revenue in late 2023. Moreover, the company achieved a revenue beat of $25,000 in its latest fiscal quarter. Given these results and its pending commercial rollout, I’m bullish about JOBY stock.
XPeng Inc. (XPEV)
Most think of XPeng (NYSE:XPEV) as a Chinese electric vehicle (EV) pure play. However, the company is set to enter the flying car industry to enhance its growth multiple.
XPeng is the majority shareholder of Xpeng Aeroht, which aims to deliver its flying cars to customers in 2026. The firm’s Land Aircraft Carrier is a large truck with a flying two-seater passenger electric drone inside. Although an audacious attempt, Xpeng Aeroht is backed with significant financial and human capital from XPeng, meaning it has a strong probability of success.
I think XPEV stock’s primary influencing factor will remain its EV unit’s performance. Nevertheless, the introduction of flying cars can enhance its growth and synergies, leading to a larger investor base. Considering these variables and XPEV’s price-to-sales ratio of 1.55x, I’m bullish about the stock!
Vertical Aerospace (EVTL)
Vertical Aerospace (NYSE:EVTL) is a manufacturer in Bristol, England. Similar to Joby, Vertical Aerospace is developing a four-passenger vertical take-off vehicle that could pioneer the industry. Moreover, the company provides investors with geographical diversification by tackling a different consumer base.
A secondary reason why I added EVTL stock to this list is its founder’s commitment. The firm’s founder, Stephen Fitzpatrick, recently injected an additional $50 million into the company, showing Vertical Aerospace isn’t a case of seeking external investor capital to gamble on a fairytale story.
The firm forecasts it will release its VX4 air taxi by 2026, pending certification. Fitzpatrick’s cash injection provides the company with a runway until mid-2025, meaning additional capital will likely be required pre-rollout. As such, investor dilution is a risk factor. Nevertheless, successful revenue recognition might make dilution risk worthwhile.
EVTL stock gained approximately 40% in the past six months. However, it remains a below-$1 stock. Therefore, a light position in EVTL stock is possible and wise.
On the date of publication, Steve Booyens did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
On the date of publication, the responsible editor did not have (either directly or
indirectly) any positions in the securities mentioned in this article.