Joby Aviation stock price has been in the spotlight in the past few days after it raised money from Toyota. It also jumped on Friday after the Trump administration announced measures to unleash the drone dominance, including in the eVTOL space.
JOBY was trading at $8.12 on Friday, up by 63% from its lowest point this year. Similarly, Archer Aviation (ACHR) stock jumped to $10.20, up by 9.95% from its lowest point this year.
Why Joby Aviation stock price has risen
Joby Aviation share price rose this month after Toyota, one of the top manufacturers, released $250 million to the company. These funds were part of the previously announced $500 million investment last year.
Joby Aviation hopes to use the funds to fund its obligations, including manufacturing, certification, and other administrative purposes. It also aims to boost its balance sheet, which ended the last quarter with over $812 million in cash and equivalents.
Joby has achieved a lot in the past few years, including on certifications. It has completed most of the certifications and is remaining with the fourth and fifth stages, which include testing and analysis, and show & verify. Joby hopes that it will receive full certification later this year.
The stock also jumped after the White House released a statement in support the industry, noting that:
“The time has come to accelerate testing and to enable routine drone operations, scale up domestic production, and expand the export of trusted, American-manufactured drone technologies to global markets.”
This statement means that the administration will work to speed the approval process for products by Joby Aviation and other companies in the industry.
However, the real impact of the executive order on the business will largely be muted.
Joby is a high-risk and high-reward investment
The reality with Joby Aviation and other eVTOL companies is that they are high-risk and high-reward firms.
They are high-risk companies because the industry is new and their business models has not been tested before. As such, while the estimate is that the eVTOL industry will grow from $0.51 billion in 2024 to $1.75 billion, these numbers are based on assumptions since it is a new industry.
Also, it is still unclear whether Joby Aviation’s business model will work out well in the long term. Joby aims to be an operator of air taxis and a seller of its eVTOL to customers. It has already reached deals with Delta Air Lines for this approach.
Therefore, as a high-risk and high-reward company, its stock price will surge if the business thrives and crash if the business struggles.
One positive is that only a handful of companies are building eVTOLs in the US, meaning that Joby and Archer Aviation may become duopolies in the future.
Joby Aviation stock price analysis
The daily chart shows that the JOBY share price was trading at $8.12 on Friday, up from the support at $7.66, its highest point in July last year. It has formed a golden cross pattern as the 50-day and 200-day moving averages crossed each other.
Joby has moved above the strong pivot reverse point at $7.8. It has also formed an inverse head and shoulders pattern, a popular continuation pattern.
Therefore, the stock will likely continue rising as bulls target the overshoot point at $10.15, up by 26% from the current level. A move below the support at $7 will invalidate the bullish view.
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