2023-07-19 07:38:38 ET
Joby Aviation ( NYSE: JOBY ) swung lower in early trading on Wednesday after JPMorgan downgraded the eVTOL stock to an Underweight rating after having it slotted at Neutral.
The firm believes Joby Aviation ( JOBY ) is well positioned to execute on its strategy and overcome obstacles, but called the stock overvalued relative to eVTOL peers. Analyst Bill Peterson and his team also see further risk to certification timelines due to a lack of consensus at the FAA.
The sizzling rally of JOBY in late June on news that it had received its Special Airworthiness Certificate for the first aircraft produced off its Marina, California line was called largely overblown and a reflection of significant short covering and retail flows rather than improved fundamentals.
"We do acknowledge that the path to certification has been de-risked relative to the time of our initiation (please see discount rate framework below) as JOBY has achieved its Means of Compliance and is set to commence flight tests with its conforming aircraft. As such, we refresh our valuation methodology using an equal blend of a 2x EV/Sales multiple and 15x EV/EBITDA multiple applied to 2027 values and discounted to 2024 at a 22.5% discount rate (down from 25%) which we think accounts for a modestly de-risked path ahead, in addition to a DCF out to 2035 which reflects our mid-term market share assumptions for JOBY."
Shares of Joby Aviation ( JOBY ) fell 6.36% in premarket trading to $9.42 vs the 52-week trading range of $3.15 to $11.98. Short interest on JOBY stands at 14.53% of the total float.
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For further details see:
Joby Aviation sheds 6% after JPMorgan issues bearish call