TLDR
- Joby Aviation shares dropped more than 11% on Wednesday after the company priced a $514 million share offering at a discount.
- The company sold 30.5 million shares at $16.85 each, representing a 10.9% discount to the previous closing price.
- Proceeds will fund aircraft certification, manufacturing expansion in California and Ohio, and preparation for commercial operations following the Blade Air Mobility acquisition.
- The stock had gained 133.7% year-to-date before the offering, with the company holding a market value of $16.3 billion.
- Morgan Stanley served as sole bookrunner for the offering, which is expected to close on Thursday.
Joby Aviation took a hit on Wednesday. Shares fell more than 11% after the electric air-taxi maker announced the pricing of a $514 million equity offering.
The Santa Cruz, California-based company sold 30.5 million shares late Tuesday. The price was set at $16.85 per share.
That represents a 10.9% discount to the stock’s previous close. The market didn’t take kindly to the news.
Joby outlined its plans for the capital raise. The funds will support aircraft certification and manufacturing efforts.
The money will also help prepare for commercial operations. Working capital and general corporate needs round out the list.
Before this drop, Joby’s stock had been on a tear. Shares had climbed 133.7% year-to-date through Tuesday’s close.
The company’s market value stands at $16.3 billion according to LSEG data. That’s a hefty valuation for a pre-revenue company.
Toyota Motor backs the electric aircraft maker. The company is also positioned to benefit from federal support for air taxi deployment announced last month.
Expansion Plans and Recent Deals
Joby recently completed the acquisition of Blade Air Mobility’s passenger business. The company plans to integrate this service into the Uber app as early as next year.
The air-taxi maker has also partnered with L3Harris Technologies. Together they’re developing a military aircraft.
Canaccord Genuity analyst Austin Moeller weighed in on the capital raise. He noted the proceeds will fund continued S4 eVTOL aircraft development.
The money will support manufacturing expansion in both California and Ohio. It will also prepare commercial operations at vertiports following the Blade acquisition.
Valuation Metrics
Joby’s shares trade at a 12-month forward price-to-earnings ratio of -23.6. Rival Archer Aviation trades at -11.4.
Both companies remain pre-revenue. They continue to trail the broader market on valuation metrics.
The eVTOL industry is racing to secure regulatory approvals. Companies are competing to bring their aircraft to market first.
The goal is to meet growing demand for faster urban transportation. These vehicles promise more sustainable travel options for city dwellers.
Morgan Stanley acted as the sole bookrunner for the offering. The deal is expected to close on Thursday.
