The Joby Aviation stock price nosedived and reached to a low of $11, its lowest level since July last year. It has plunged by nearly 50% from its highest level in 2025, meaning that the market capitalization has dropped from over $17.53 billion to $10 billion today. So, is it a good buy today?
Why the Joby Aviation stock price has crashed
The Joby Aviation share price crashed by over 16% on Thursday after the company continued its dilution as it moves towards commercialization of its electric vertical take-off and landing (EVTOL) products.
In a statement, the company has announced that it was raising more money by issuing $600 million of convertible senior notes due 2032. Its net proceeds will be $576 million, which it plans to fund the certification and manufacturing efforts and preparation for its commercialization process.
Joby Aviation has been burning cash in the past few years as it worked on its aircraft, which it expects to enter service later this year or early next year.
It recently announced its expansion to Ohio, where it will be manufacturing its aircraft. The 700k square-foot facility will have a capacity of making four aircraft a month, bringing its total production to eight.
Joby Aviation has been a highly dilutive company, a process that will continue in the foreseeable future because it will likely take time to turn a profit. Its outstanding shares rose to 844 million from 604 million in 2021.
The most recent results showed that Joby Aviation continued to burn cash in the third quarter. Its revenue was just $22.5 million, while its operating expenses rose to over $204 million. Its net loss surged to $401 million and $808 million in the first nine months of the year.
Joby ended the quarter with over $978 million in cash and short-term investments and over $2 billion in current assets. Its total liabilities were worth over $469 million.
Wall Street analysts are relatively bearish on Joby Aviation, with Weiss Ratings, Goldman Sachs, and JPMorgan having a sell rating on the company.
The main concern among analysts is that its cash burn will continue and that there is little visibility on the eVTOL business.
Joby Aviation share price technical analysis
JOBY stock chart | Source: TradingView
The daily timeframe chart shows that the Joby Aviation share price has crashed in the past few months.
It then made a strong bearish breakdown on Thursday, confirming the bearish outlook of the descending triangle pattern. It has now moved below the lower side of the triangle and landed at the 61.8% Fibonacci Retracement level.
The stock has remained below the 50-day and 100-day Exponential Moving Averages (EMA). It also moved to the extreme oversold level of the Murrey Math Lines tool.
Therefore, the most likely scenario is where the stock continues falling, potentially to the psychological level at $10. It may also drop to the 78.6% Fibonacci Retracement level at $8.42.
The alternative scenario is where the stock rebounds to the key resistance level at $12.7 and then resumes the downtrend trend.
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