Joby Stock Is Soaring. Flying Cars Get a Nod From the FAA.

The FAA certificate means Joby can start test-flying its prototype electric vertical takeoff and landing, or eVTOL, aircraft. They are designed to be smaller, quieter, easy-to-fly aircraft that sometimes are call flying cars, and might eventually be used as air taxis, taking people to airports, above ground traffic, or making short commuting flights.

Joby is a pioneer in eVTOL, and raised money by going public through a merger with a special-purpose acquisition company, or SPAC, in August 2021.

Joby stock is up 39% in midday trading Wednesday, while the

S&P 500
and

Nasdaq Composite
are up 0.2% and 0.6%, respectively. The stock is down about 50% from a record high of $17 that the SPAC stock reached in February 2021, which just before the announcement of the Joby merger, which took a few months to close.

In a SPAC merger, the stock of the SPAC is trading before it finds a merger partner and the stock, essentially, becomes the stock of the company acquired when the deal is done.

With Wednesday’s jump, Joby’s market capitalization is about $5.5 billion, indicating investors believe it has an exciting new business.

Significant sales are still a ways off, however. Wall Street projects $20 million in sales in 2024, but profits and cash flow aren’t projected until the end of the decade. Joby ended the first quarter with about $1 billion of cash on its books, and analysts project Joby will use about $400 million annually in the coming few years.

Six analysts cover Joby stock, and three have Buy ratings. The average Buy-rating ratio for stocks in the S&P 500 is about 55%. The average analyst price target is $7.20 a share.

Write to Al Root at [email protected]