Stocks to buy

The 3 Most Undervalued Flying Car Stocks to Buy in March 2024

The industry for flying cars or eVTOL aircraft is at an interesting point. Some early movers will likely commercialize eVTOL in the next 12 to 18 months. Further, flying car companies are pursuing global expansion partnerships. The stage is being set for robust growth in the next five years. It’s, therefore, a good time to buy undervalued flying car stocks for multibagger returns.

Regarding industry size, it’s estimated that the flying car market will be worth $1.06 billion by 2030. This is, however, the tip of the iceberg. The market size is expected to swell to $1 trillion by 2040 and further to $9 trillion by 2050. Therefore, companies that can stay ahead in technology and innovation will likely be massive value creators.

This column focuses on three flying car stocks poised for stellar growth and value creation in the next five years.

Archer Aviation (ACHR)

Source: T. Schneider / Shutterstock.com

Considering the impending growth, Archer Aviation (NYSE:ACHR) is among the most undervalued flying car stocks to buy. After touching highs of $7.5 in August 2023, the stock has traded sideways to lower. With the commercialization of eVTOL aircraft likely in 2025, I am bullish on ACHR stock.

It’s worth noting that Archer is setting a strong base for growth from 2025. Currently, the company has an order backlog of $3.5 billion. Further, Archer is on track to complete its manufacturing facility this year, which can produce 650 eVTOL aircraft annually.

Another positive is that the company has stitched partnerships in the UAE and India for expansion in 2026. With a strong liquidity buffer, Archer is well positioned to pursue aggressive growth. Archer is targeting to complete 400 test flights this year on the commercialization front. Currently, three conforming midnight aircraft are under construction and will be used in piloting “for credit” testing with the Federal Aviation Authority.

EHang Holdings (EH)

Source: Toto Santiko Budi / Shutterstock.com

Despite positive business developments, EHang Holdings (NASDAQ:EH) stock has been subdued in the last 12 months. I believe a big upside breakout is imminent for this flying car stock.

In December 2023, EHang successfully completed its debut commercial flight demonstrations in Guangzhou and Hefei, respectively. This marked the first step towards commercialization in China.

It’s worth noting that the Company’s EH216-S passenger-carrying unmanned aerial vehicle system has obtained the world’s first standard airworthiness certificate. The Company is marketing the same eVTOL for sale in international markets for $410,000.

EHang has already conducted thousands of trial flights in multiple European and Asian countries. It’s worth mentioning that the Wings Logistics Hub in the UAE will be purchasing 100 units of EH216 series eVTOLs from EHang. In the next few years, I expect the order backlog for the eVTOL to swell.

Joby Aviation (JOBY)

Source: T. Schneider / Shutterstock.com

Joby Aviation (NYSE:JOBY) stock had touched highs of $12 in July 2023. The stock has subsequently witnessed profit booking and significant correction to current levels of $5.4. I believe that current levels are attractive for fresh accumulation.

In February, Joby announced that it had completed the third stage of the certification process with the Federal Aviation Authority. With two stages of certification remaining, Joby is well on track for commercialization in 2025.

In another significant development, Joby signed an agreement with the government of Dubai that granted Joby exclusive rights to operate air taxis for six years. With these positive developments, Joby is positioned to deliver strong numbers in the next few years.

As of Q4 2023, the Company reported a liquidity buffer of $1 billion. Joby has also guided $440 to $470 million in cash used for this year. Therefore, I don’t see any near-term likelihood of equity dilution. Also, once operations commence in the United States and UAE, I expect Joby to enter new markets to accelerate growth.

On the date of publication, Faisal Humayun 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.

Faisal Humayun is a senior research analyst with 12 years of industry experience in the field of credit research, equity research and financial modeling. Faisal has authored over 1,500 stock specific articles with focus on the technology, energy and commodities sector.

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