ACHR - 3 Urban Air Mobility Stocks Ready for Liftoff
2024-07-09 11:00:00 ET
InvestorPlace - Stock Market News, Stock Advice & Trading Tips
For many of the global problems today, the solution will arrive via air mobility in the near future. Too much traffic? Flying cars! Overloaded airports and other overworked transportation infrastructure? Facilities to handle passengers and cargo at alternate sites like heliports. Meeting the demands of the burgeoning consumer class across the world? Air mobility brings in goods and services ranging from healthcare products to flying taxis. As always for investors, the challenge is to buy into those urban air mobility stocks that will soar the highest!
There is a wide range of choices that range from mega-caps to micro-caps. Fortunately for investors, there are ways to achieve positions across the air mobility industry. This investment can also result in a single holding that is positioned in many areas of air mobility.
In addition, there is certain to be consolidation in the air mobile industry. That is the nature of the transportation sector, especially aviation. The more appealing an air mobile stock to an investor today the more attractive the company is to a buyer in the future.
Boeing (BA)
For shareholders of Boeing (NYSE: BA ), checking out the news lately has been a painful experience. The stock price is down almost 30% for the year. But Boeing has taken important steps to recover. The first was realizing what needed to be fixed to restore its brand by focusing on the quality of the product. Boeing is doing that, which is bullish news.
A major part of that is acquiring Spirit AeroSystems (NYSE: SPR ) in an all-stock deal. A vital supplier to Boeing, it builds the fuselage for the Boeing 737 passenger jet, among other crucial components. Aerospace consultant Dr. Mike Heil, who headed the Ohio Aerospace Institute, told InvestorPlace that, “Boeing made a big mistake when they outsourced aerostructure manufacturing to Spirit AeroSystems. Engineering, design and manufacturing must be closely linked to produce a superior airplane. By purchasing Spirit, Boeing improves those links and gains direct line authority and control of aerospace manufacturing for their airplanes.”
Wall Street approves of the Spirit AeroSystems acquisition as Boeing stock is up recently. Boeing is active across the air mobility industry from flying taxis to rockets for space travel. Management is taking the right steps to bring the company back to the front of urban air mobility stocks so long-term investors should be rewarded.
Tesla (TSLA)
At times, it seems like things are never easy with an Elon Musk company. Based on the trajectory of Tesla’s (NASDAQ: TSLA ) stock, it should be worth the extra patience for the urban air mobility gains to appear in the stock price as Musk just claimed Tesla will have a flying car by 2025. Who wouldn’t have wanted to have invested in the early stages of Tesla when it IPOed for $17 a share in 2010?
Urban air mobility will add more value to Tesla. SpaceX , the space company Musk founded, was just valued at $210 billion , making it the most valuable aerospace company. Urban air mobility through a flying car will fill the range of transportation for Musk in a form that no one has ever accomplished.
There is Boring , his tunneling company, for underground travel. Tesla is the most valuable motor vehicle company. SpaceX dominates space commerce. A flying car will fill out the product line for Musk. Based on his recent record pay package, his shareholders more than approve of his vision and execution. Wall Street appreciates it too as it already adds a hefty premium for Tesla. That should increase even more when Tesla becomes viewed among valuable urban air mobility stocks, too.
United Airlines (UAL)
As a major domestic airline, United Airlines (NYSE: UAL ) offers several ways to invest in air mobility. It operates in every inhabited continent so there is investment in passenger travel and cargo transportation worldwide. United is a major buyer of airplanes so what is good for United is good for Boeing and other aerospace manufacturers.
It is also at the tip of the flying taxi segment of air mobility. Here, United is partnering up with Archer Aviation (NYSE: ACHR ). A flying taxi company, Archer announced a deal last year with United to provide service from Chicago’s O’Hare Airport to a downtown heliport in the Medical District of Chicago . Archer recently announced plans for a network in the San Francisco Bay area .
For 2024, United stock is up by almost 15%. In the last month, it received three analyst upgrades. Its new policy of being more transparent has also been met with approval. There is also high institutional ownership with a low short float. That combination indicates that hedge funds, pension groups and other institutional investors are bullish on United.
On the date of publication, Jonathan Yates 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 .
On the date of publication, the responsible editor did not have (either directly or
indirectly) any positions in the securities mentioned in this article.
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