Joby Aviation (JOBY) and several of its peers are taking to the skies today following a key aviation industry update from regulators. The Federal Aviation Administration (FAA) has released a final set of rules for companies in the nascent air taxi space, primarily on pilot training and aircraft operations. This long-awaited news has created positive momentum, pushing up most air taxi stocks.
What will this update mean for the fast-growing electric vertical take-off and landing (eVTOL) sector? Let’s take a closer look at the FAA’s new rules and assess what investors should be focused on.
What’s Happening with JOBY Stock
After a few hours of little to no momentum, Joby Aviation began rising quickly, accelerating even more as the FAA’s regulatory update began to trend. As a result, JOBY stock closed 12.57% higher and looks primed to continue making progress. While the past week has been fairly volatile, Joby has exhibited an overall strong performance, rising 13%.
Other air taxi stocks are rising today as well. Joby rival Archer Aviation (ACHR) finished up over 7% on the day after a highly volatile month. Both companies appear to have found some stability now that the rules for their industry are becoming more clear. This bodes well for both companies, as they will likely be able to continue operations with a better idea of the regulations they will be following.
In a statement released today, the FAA stated that “the opportunities for the use of powered lift operations are far reaching, from transporting passengers in urban areas and short-haul operations such as air ambulance services and cargo operations to potentially serving smaller communities over time.”
Is Joby Stock a Strong Buy Right Now?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on JOBY stock based on four Buys, one Hold, and one Sell assigned in the past three months, as indicated by the graphic below. After a 9% rally in its share price over the past year, the average JOBY stock price target of $8.25 per share represents a 33.28% change from current levels.
Canaccord recently took a look at what the FAA rules will mean for the eVTOL sector, describing it as “broadly positive.” The investment bank maintains Buy ratings on many air taxi stocks, including Joby and Archer and several of their international competitors, who will likely be less impacted by these regulations.
