After a special purpose acquisition company merger with Reinvent Technology Partners, California-based electric aircraft maker Joby Aviation (NYSE:JOBY) went public on Aug. 11. So far, JOBY stock has taken a few brief flights, but it’s also experienced some rough landings.
Of course, Joby isn’t the only publicly tradable commercial aviation business. However, it is the first U.S.-based eVTOL (electric vertical takeoff and landing) company listed on a public market to trade on the New York Stock Exchange.
Folks who were hoping to build wealth quickly with JOBY stock have largely been disappointed so far. Yet, I would encourage them to stay the course as sustainable aviation, as it relates to short-term flights, is still a new concept.
In other words, the air taxi industry is still in its infancy. Except for test flights, you probably won’t see Joby’s aircraft in the skies for a few years – but by then, the share price could be much higher than it is today.
A Closer Look at JOBY Stock
When the stock was a SPAC stock that traded under the ticker symbol RTPY, it was priced at around $10.
However, with the Aug. 11 debut of JOBY stock, it opened at $10.62 and then surged 20%. The stock even threatened to break through $14 at one point.
That’s an auspicious beginning, but volatility ensued. Over the next few months, the stock kept coming back to $10 even after bouncing back and forth between $8 and $14.
Now JOBY stock is below the pre-SPAC-deal-announcement $10 level. Admittedly, high volatility and no price appreciation can be a frustrating combination.
Therefore, this is the type of stock where you might choose to buy a few shares and leave them alone for a few years. Checking in every day for profits and losses probably won’t benefit the long-term shareholders.
Hopefully, someday JOBY stock will be worth $15 at least, for a 50% return on investment. As always, patience is the key to winning the game of investing.
Reducing Urban Congestion
There’s no denying that traffic congestion is a major issue in America’s big cities. Air taxis offer a way to relieve that congestion, at least to a certain extent.
As an eVTOL business, Joby Aviation wants its vehicles to be not only convenient, but also fast, quiet and safe.
The company deserves credit for being an early innovator in its niche. Joby has actually been around since 2009, and today it employs more than 800 people.
Already, Joby Aviation has developed aircraft with a maximum range of 150 miles on a single charge. Not only that, but the aircraft can transport a pilot and four passengers at speeds of up to 200 miles per hour.
Don’t expect to ride a Joby aircraft this year or even next year, however. Apparently, the company’s air taxi service is set to commence in 2024.
Reducing the Noise
In addition to being fast and convenient, Joby Aviation’s air taxis should produce relatively low noise.
This is an objective that Joby is taking very seriously. To demonstrate this, the company just became the first company to fly an electric aircraft as part of NASA’s Advanced Air Mobility National Campaign.
Building on nearly a decade of joint research by Joby and NASA into electric flight, this two-week test campaign will analyze the noise footprint of Joby’s aircraft.
This will take place at Joby’s Electric Flight Base near Big Sur, California. Together, NASA and Joby will join forces to study the “acoustic signature” of the all-electric Joby aircraft.
It’s a complex operation, but it could prove to be extremely valuable.
NASA engineers will deploy their Mobile Acoustics Facility and more than 50 pressure ground-plate microphones in order to measure Joby aircraft’s sound emissions.
With that, NASA and Joby will attempt to capture the sound profile of Joby’s aircraft. It will be interesting to learn the results of this research, so keep your eyes peeled for updates.
The Bottom Line
By now, you should have the impression that JOBY stock is meant to be a long-term investment.
Sure, it could provide returns in the near term. Yet, the air-taxi industry is still growing and developing, so investors should be patient.
A 50% return on investment does seem realistic, however, if the shareholders stay in the trade long enough.
So, just sit tight and let Joby Aviation advance the science of sustainable aircraft – and don’t feel the need to check on your investment every day.
On the date of publication, David Moadel did not have (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.