The research on flying car stocks suggests the market could quickly double. That report anticipates annualized growth rates of 58% during the period between 2022 and 2040. The math equates to a doubling in value less than every two years. At those rates, there are bound to be leading stocks in the sector that grow with tremendous speed, producing massive returns.
Fortunately for investors, the market has shaken out in an easy-to-understand manner at this early juncture. A handful of leading firms represent obvious investment choices and few others to consider. Let’s look at them.
Joby Aviation (JOBY)
Currently, Joby Aviation (NYSE:JOBY) is my choice for the best flying car stock. The company is further along than its competition and at this point looks most likely to reach commercial stages the quickest. That doesn’t mean it will be strong indefinitely, but it could be the best choice right now.
Joby Aviation is expected to reach commercialization first because the FAA has already accepted more than two-thirds of the company’s certification plans. That puts it ahead of everyone else. Further, Joby Aviation’s production prototype was manufactured in Q2 and is currently undergoing flight tests.
The company has a clear path to initial commercial operations in 2025 per its most recent shareholder letter. The company is essentially three-fifths of the way to that goal, with testing and verification stages remaining ahead. Joby Aviation will continue to contend with sharp losses as it marches toward the goal of commercialization. The company enjoys wide-ranging support that includes commercial firms and government backers as well.
Archer Aviation (ACHR)
Archer Aviation (NYSE:ACHR) is behind Joby Aviation in terms of development. The stock is still worth investing in, given that there will be plenty of space for growth across the sector — for one. Further, Archer Aviation has particularly strong DoD ties that could propel it much higher.
Let’s start there. During the second quarter, Archer Aviation announced it secured the largest Air Force contract of any eVTOL OEM worth $142 million. That relationship makes Archer Aviation’s losses much more palatable because investors are much more likely to see it as investment-worthy. The DoD believes in the firm, ensuring further investment from other sources.
The company is also targeting 2025 commercial operations and has $1.1 billion of collective funding with backing from United Airlines (NASDAQ:UAL), Boeing (NYSE:BA), Stellantis (NYSE:STLA), and others.
EHang Holdings (EH)
EHang Holdings (NASDAQ:EH) is the best stock to consider for investors seeking Chinese eVTOL investments. The company is already generating revenues, which cannot be said for the two American firms already discussed. That’s a powerful catalyst overall.
Revenues fell in the second quarter to $1.4 million but, again, the company is making money. However, EHang was not profitable and lost $10.4 million during the period. Those sales clearly aren’t sufficient for the company to continue indefinitely. EH received a $23 million private placement investment that should take it through July of 2024, according to its earnings report. It’s racing against time, with the company desperately hoping to further certification — a balancing act that could go either way.
The company has an order backlog exceeding 100 units for its EH216-S vehicle. EHang developed 20 trial operation sites across 18 cities in China and intends to use its vehicle for extensive tourism purposes. It has also conducted more than 9,300 test flights for low-altitude tourism and sightseeing in China and more than 39,000 demo and trial flights in total across 14 countries. Investing in EHang is risky but the stock enjoys a price above $19, projecting established stability to investors.
On the date of publication, Alex Sirois 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.
