You’ve got your core portfolio holdings, but beyond that, you can have some fun with high-risk, high-potential reward assets like Joby Aviation (NYSE:JOBY) stock.
Not everyone should take a share position in Joby Aviation, so learn as much as you can about the company before considering an investment.
In a nutshell, Joby Aviation builds electric vertical takeoff and landing aircraft. These vehicles can take off vertically but then fly like an airplane.
To put it in simpler terms, Joby Aviation manufactures flying cars. It’s a fascinating business, and prospective investors have a lot to consider.
So, let’s delve into the details and see if a share position in Joby Aviation may be appropriate for your portfolio.
Joby Aviation’s History-Making Flight
Someday, eVTOL aircraft might become commonplace. If flying cars eventually fill the sky, Joby Aviation will have established itself as an early mover in a fast-growing niche industry.
Of course, there’s no guarantee that any of this will actually happen. Joby Aviation is unafraid to make history in the air-mobility domain.
Specifically, a subsidiary of Joby Aviation reportedly completed the world’s first piloted flight of a liquid hydrogen-powered electric aircraft.
Joby Aviation (and/or its subsidiaries) may achieve more historic firsts in the coming months and years. Meanwhile, the Federal Aviation Administration’s timeline proposes that urban air taxis could begin service over U.S. cities as early as 2028.
The eVTOL aircraft industry could expand rapidly and JOBY stock provides pure-play exposure to this niche market. But before you go all-in with a share position in Joby Aviation, let’s consider the risks involved.
JOBY Stock Soars and Sinks
Always remember there are risks involved if you’re invested in an early-stage industry. To see this in action, observe how JOBY stock flew from $3 to nearly $12 this year, but then fell back to $6.
Some folks might call this a meme-stock pop-and-drop. Yet, it’s not unusual for stocks representing small businesses in emerging tech domains to be volatile.
Joby Aviation isn’t a profitable business in 2023. That’s probably why Joby Aviation spent little time discussing sales or income in its second-quarter shareholder letter. Also, if Joby Aviation doesn’t have a price-to-earnings ratio, value-focused investors might have some difficulty assigning a valuation to the company.
Furthermore, JPMorgan analysts reportedly downgraded JOBY stock from “neutral” to “underweight.” In defense of this downgrade, the analysts cited a “largely overblown rally” in the shares. The Joby Aviation share price has come down during the past several months.
JOBY Stock: Are You Feeling Lucky?
Joby Aviation could end up pioneering an emerging niche industry. Hence, risk-tolerant investors may choose to hold a few shares of Joby Aviation in hopes of a multi-year rally.
However, there are no guarantees that Joby Aviation will succeed as a business venture in the long run.
In the final analysis, JOBY stock gets a “B” grade and may be appropriate for some investors’ portfolios. Just be sure to limit your position size small in order to mitigate the risk of capital loss.
On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.