Joby Aviation: Buy, Sell, or Hold?

As the electric vertical takeoff and landing (eVTOL) market gains traction, investors are eager to identify promising stocks. Joby Aviation (NYSE: JOBY) has emerged as a leading player, but is it a buy, sell, or hold? Let's dive into the data and expert opinions to make an informed decision.

Market Sentiment and Analyst Ratings

In the previous week, Joby Aviation had 12 more articles in the media than Embraer (NYSE: ERJ), with a total of 18 mentions for Joby Aviation and 6 mentions for Embraer. Joby Aviation's average media sentiment score of 0.63 beat Embraer's score of -0.34, indicating that Joby Aviation is being referred to more favorably in the media.

Analysts have a consensus price target of $8.35 for JOBY, suggesting a potential downside of 0.48%. Embraer has a consensus price target of $37.43, suggesting a potential upside of 2.83%. Given Embraer's higher possible upside, analysts clearly believe Embraer is more favorable than Joby Aviation.

Volatility and Risk

Joby Aviation has a beta of 2.32, suggesting that its stock price is 132% more volatile than the S&P 500. Comparatively, Embraer has a beta of 1.72, suggesting that its stock price is 72% more volatile than the S&P 500. This indicates that Joby Aviation may be riskier than Embraer.

Earnings and Valuation

Embraer has higher revenue and earnings than Joby Aviation. Joby Aviation is trading at a lower price-to-earnings ratio than Embraer, indicating that it is currently the more affordable of the two stocks. However, Joby Aviation's net margin of -42,844.57% and return on equity of -51.76% suggest that the company is not yet profitable.



Strategic Partnerships and Contracts

Joby Aviation's strategic partnerships with NASA, Toyota, and the U.S. Air Force are pivotal, providing financial backing, technological expertise, and market credibility. However, Embraer's higher revenue and earnings, as well as its lower price-to-earnings ratio, suggest that it may be a more attractive investment option.

Expert Opinions

Investment professionals have mixed opinions on Joby Aviation. Some analysts, such as those from Morgan Stanley and Cowen, have a "Buy" rating on the stock, while others, like those from JPMorgan and UBS, have a "Neutral" or "Sell" rating. The consensus rating is "Strong Buy," but the average price target of $9.30 is only 33.24% higher than the current price, indicating that analysts are not overly bullish on the stock.

Conclusion

Based on the data and expert opinions, Joby Aviation appears to be a risky investment due to its high volatility, negative earnings, and mixed analyst ratings. While the company's strategic partnerships and innovative technology are promising, Embraer's stronger financial performance and lower price-to-earnings ratio make it a more attractive investment option. As a result, investors may want to consider selling or holding Joby Aviation and exploring other opportunities in the eVTOL market.

Action Alerts PLUS, which Cramer manages as a charitable trust, is long ERJ.