eVTOL (electric vertical takeoff and landing) stocks represent one of the fastest growing industries in the future. Morgan Stanley estimates the eVTOL industry will reach $1.5 trillion as we explore urban air travel to reduce traffic and open up a brand new wave of intracity travel.
Right now, investing in eVTOL stocks is like buying Tesla stock several years ago. Nobody is talking about this industry but so many people will began traveling from city to city via short distance electric helicopters and airplanes in the future.
Why Invest in eVTOL stocks?
Of course, the eVTOL industry will be huge but I’ll provide a list of strong reasons to invest in the eVTOL industry:
- Urban air mobility is one of the biggest growth industries this decade.
- Urban air travel will reduce traffic in major cities and allow passengers to reach destinations in much shorter periods.
- eVTOL stocks are mostly priced near initial SPAC pricing levels of $10, meaning investors are getting in at the lowest price possible.
- EV stocks soared in 2020 but many investors missed the EV boom. The eVTOL boom is inevitable so this is your 2nd chance to cash in on the electric transportation industry.
- eVTOL companies will reduce carbon emissions that harm our planet and improve the entire planet’s ecosystem in the future.
Best eVTOL Stocks
Here’s a list of my favorite eVTOL stocks that could produce 10x gains in the next few years:
- Blade Air Mobility (NASDAQ: BLDE)
- Atlas Crest Investment Corp (NASDAQ: ACIC)
- Reinvent Technology Partners LLC (NYSE: RTP)
- Ehang (NASDAQ: EH)
- Qell Acquisition Corp (NASDAQ: QELL)
1. Blade Air Mobility (BLDE)
Blade completed its SPAC merger with Experience Investment Corp to become the first publicly traded air taxi company.
Blade was one of the first eVTOL SPACs to go public last year yet the stock still trades near the initial $10 price point. What’s nice about Blade is that the company is already generating revenue but plans to expand by 2024 with the additional of an all-electric electric aircraft fleet that will be 100% carbon neutral.
Blade operates in 4 key business models:
- Short Distance flights: Flights between 60 and 100 miles costing $595 to $795 per seat.
- Blade Airport: Flights between all NYC airports and dedicated BLade lounges in Manhattan. Prices start at $195 (Only $95 with annual airport pass)
- BLADE MediMobility: Blade is the largest transporter of human organs in the Northeast United States and expects to drive revenue growth while the passenger business increases.
- International Joint Ventures: Blade launched a JV in India to provide passenger flights between Mumbai, Pune, and Shirdi.
The company uses an asset light business model by operating a 3rd party app that allows passengers to book short distance helicopter flights throughout the United States.
Think Uber for helicopters.
Blade turns a 2 hour drive in NYC into a 5 minute helicopter flight using the Blade app.
Blade founder and CEO Rob Wiesenthal spent several years working for Sony and Warner Bros Music Group before founding Blade in 2014. He believes that the next EV battle will happen in the air.
The company expects to reach $825 million in revenue by 2026, providing a conserative valuation of around $8 to $10 billion in the next 5 years.
BLDE stock currently trades at just $8 with a $825 million valuation so there is a lot of upside for Blade in the future.
2. Atlas Crest Investment Corp (ACIC)
Archer Aviation is set to merge with Atlas Crest Investment Corp in a SPAC merger valued at $3.8 billion. The newly formed company will close the merger in Q2 2021 and be listed under “ACHR” on the NYSE.
Archer plans to develop an all-electric aircraft called the Maker that is capable of traveling 60 miles at 150 mph.
The company received a $1 billion preorder from United Airlines to produce 200 Maker aircrafts to connect United passengers between hubs. Archer also has a partnership with the City of Los Angeles to help reduce dense traffic jams and improve urban air transportation in one of America’s most busiest cities.
Archer Founders Brett Adcock and Adam Goldstein are relatively young when compared to other CEOs, giving them an extremely long timeframe to disrupt the electric aircraft industry and return value to shareholders.
If you’re thinking about investing in Archer’s SPAC then realze you are in good company.
Archer Aviation is backed by well known investors and celebrities like Cathie Wood from Ark Invest, Former MLB Player Alex Rodriguez and Tesla HODLer Ron Baron.
In fact, Cathie wood bought over 2 million shares of ACIC stock through Ark invest alone.
However, Archer operates a different business model than Blade uses. Blade is an asset light company that doesn’t own or manufacture any electric aircrafts while Archer plans to generate the bulk of its revenue from producing eVTOLs.
Archer’s revenue growth is closely correlated with total electric aircraft output just like Tesla.
Archer plans to generate over $1 billion in revenue by 2025 with a goal of hitting over $12 billion in annual revenue by 2030.
I believe ACIC stock has at least 5 to 10x upside in the next few years because most investors are ignoring eVTOL stocks like Archer. You can buy ACIC stock at around $10, which means the only direction is up as long as Archer produces aircrafts and hit revenue targets.
3. Reinvent Technology Partners LLC (RTP)
Joby Aviation is set to merge with Reinvent Technology Partners to take the company public via a SPAC merger valued at $6.6 billion. The newly formed company will be named Joby Aviation and trade on the NYSE under the ticker symbol, RTP.
Joby plans to enter in the all-electric air taxi market in 2024 with its 4 passenger emissions free aircraft that can travel up to 150 miles with 1 charge at up to 200 mph.
With more than 1,00 test flights over the last 10 years, Joby is well positioned to disrupt the eVTOL market and gain substantial marketshare in this relatively new industry.
If you’re thinking about investing in Joby Aviation (RTP) then realize you are in good company.
Some of Joby’s backers include Toyota Motors, Uber, Zynga founder Mark Pinkus and Linkedin Founder Reid Hoffman.
In order to compete in eVTOL market, Joby acquired Uber Elevate to further beef up its air taxi business and prepare for robust growth in the next few years. In return, Uber boosted its take in Joby Aviation to $125 million, which will give Uber a portion of the newly formed company once the SPAC merger is complete.
To help speed up production, Joby partnered with Toyota to help manufactures its aircrafts under a newly planned production plant with the potential to greatly reduce the cost of each aircraft over time.
Right now, Joby isn’t generating much revenue and many investors may scoff at the $6 billion valuation. That’s understandable but Joby has plans to scale revenue quickly to address the growing need for urban air travel to reduce traffic jams and gridlock.
Joby projects to generate revenue in 2024 with a goal to hit $20 billion in annual revenue by 2030.
If Joby can hit $2 billion in revenue by 2026 then it’s safe to estimate a total company value of between $20 to $30 billion. That gives investors 3 to 5x upside over the next 5 years if Joby executes its goals.
Joby is well more established than competitors like Blade or Archer due to its 700+ employee team, 10 years of flight experience, and strategic partnerships with Uber, Toyota, and thee Department of Defense.
I think it’s speculative to invest in a $6+ billion company with zero revenue and will be more than happy to gain exposure to Joby Aviation through my ownership in Uber stock.
Joby is still a good eVTOL stock to buy and could be an absolute steal at just $10 per share.
4. eHang (EH)
eHang is a Chinese based eVTOL producer that plans to disrupt the entire AAV market with its innovative electric aircrafts.
The company produces its flagship eVTOL called the EH216 and plans to scale production into the future.
The EH 216 is beautifully designed and 100% autonomous with the ability to reduce traffic congestion for short to medium range trips. In 2020, eHang carried out over 10,000 EH 216 trial flights (including passenger haul) safely.
eHang is one of the few eVTOL companies that currently generates revenue so consider them an early frontrunner in the EVTOL race.
In its most recent Q4 2020 quarter, eHang delivered 22 EH216 and generated $8.4 million in revenue.
Of course, EH stock comes with several additional risks like most Chinese publicly traded companies. eHang stock traded as high as $125 in February 2021 until Wolfpack Research, a well known short seller, published a negative report titled, “Ehang: A Stock promotion Destined to Crash and Burn.”
The negative report cites several issues with eHang’s revenue numbers and other problems within the company. Since then, EH shares have plummeted more than 80% as the company attempts to rehabilitate its image.
With just $27.6 million in 2020 revenue, EH stock trades at a Price to sales ratio of 52 and looks overvalued from a fundamental standpoint.
I personally don’t invest in Chinese stocks for several reasons but eHang is an early disrupter and could scale production with the launch of its latest AAV production facility in Yunfu City, China.