Joby Aviation cut at JPMorgan as commercial opportunity still a ways off

This post was originally published on this site

JP Morgan analysts downgraded JOBY to Underweight from Neutral on Wednesday, while setting a $6 price target (up from $5). The new price target suggests 40% downside from yesterday’s closing price.

“In our discussions with institutional investors over the past few months, which have picked up meaningfully in recent weeks, we sense a lot of skepticism around the timing and size of the commercial opportunities for eVTOL, at least within this decade,” analysts commented.

While Joby and peer Archer Aviation (NYSE:ACHR) are still leading the race for FAA certification in the U.S., they see limited short-term upside for ACHR and downgrade JOBY to Underweight. They do, however, acknowledge Joby’s strong management, certification progress, and recent advancements in technology. That said, their expectation aligns with the FAA’s Advanced Air Mobility Implementation Plan, which sets 2028 as the target year for significant operational growth in eVTOL commercialization.

The analysts continue to see “relative value” in ACHR, which they see as “neck-and-neck” with JOBY, and continue to rate that stock an Overweight.

In addition, analysts think Overweight-rated Blade (NASDAQ:BLDE) offers a potentially safer near-term opportunity to participate in the advanced air mobility trend, focusing on helicopters. It benefits from established passenger routes and infrastructure in key markets that can eventually transition to electric aviation. Additionally, Blade has an underappreciated non-cyclical business involving organ transport.