Flying cars may soon become a reality. In the past few years, many companies have embarked on one mission: to create the world’s first fully functional flying car. Significant potential exists from this possibility. The flying car industry was valued at around $220 million in 2022 and it is expected to grow fast. Over the next two decades, experts forecast that the industry will reach a valuation of more than $1.5 trillion at a CAGR of over 55%. There are some very promising flying car stocks out there.
Flying cars are more environmentally friendly, while they also reduce travel time and increase productivity. They can revolutionize transportation as we know it. Though there is still much needed for their creation, here are the three best flying car stocks.
Lilium NV (LILM)
Lilium N.V. (NASDAQ:LILM), a German aerospace company founded in 2015, has made significant strides in the field of electric vertical takeoff and landing (eVTOL) aircraft. Its flagship Lilium Jet project is an innovative electric airplane designed for urban air mobility. The company achieved a milestone when it received “Design Organization Approval” from the European Union Aviation Safety Agency, allowing it to design and operate its eVTOL vehicles globally. The Lilium Jet, equipped with a unique propulsion system using multiple ducted propellers, aims to revolutionize intercity travel with a target range of 280 km. The company envisions launching a commercial air taxi service by 2025, positioning itself among notable competitors like Boeing (NYSE:BA) and Airbus (OTCMKTS:EADSY) in the rapidly evolving flying car industry.
Several factors suggest a potential opportunity for investors considering buying the stock. As of December 6, 2023, Lilium GmbH’s Enterprise Value remains stable compared to the past year, with a tangible asset value expected to grow to about $293.2 million. The market price is $1.38, indicating a potential undervaluation. Key fundamental drivers influencing Lilium GmbH’’s valuation include a price-to-book ratio of 2.3484 and a relatively low enterprise value to EBITDA of 1.49. Analyst consensus also suggests an undervalued status, with a target price range of $0.75 to $3.00.
EHang Holdings (EH)
EHang Holdings (NASDAQ:EH) stands out as a pioneering force in the AAV (autonomous aerial vehicle) space, particularly in China. The company has impressed the flying car industry with robust trial flights across China, establishing 19 testing areas in 17 cities and conducting over 8,800 trial flights over tourist areas. Its active sales, demonstrated by the delivery of AAVs to Fengshan Tourism Investment Development, indicate a strong commercial presence, with further plans to deliver more units showcasing its growth potential. The firm’s involvement in the tourism sector and its commitment to expanding its AAV fleet make it a compelling prospect for investors looking at the flying car industry.
EHang Holdings has demonstrated remarkable year-over-year revenue growth of 41.6%, signaling robust demand for its autonomous aerial vehicles. With gross margins impressively standing at 67.1%, the company illustrates profitability in its core operations. Despite the company’s reported net loss of $12.7 million in the recent quarter, this was an improvement, with losses narrowing by 21%. This financial trajectory suggests that EHang is moving towards operational efficiency and could be edging closer to profitability. Such fundamentals could be appealing to investors looking for growth opportunities in the emerging eVTOL market, especially considering EHang’s active sales and expanding trial operations.
Archer Aviation (ACHR)
Last on our list of promising flying car stocks is Archer Aviation (NYSE:ACHR), has quickly established itself as a key player in the emerging electric vertical take-off and landing (eVTOL) aircraft industry, focusing on revolutionizing urban air mobility. Founded in 2018, Archer has made significant strides, including securing a notable deal with United Airlines, which has placed a $10 million pre-delivery payment for 100 of Archer’s Midnight eVTOL models. This agreement underscores the confidence the industry has in Archer’s innovative eVTOL technology and its potential to transform urban commuting. Adding to its list of strategic achievements, Archer Aviation recently secured a significant contract with the U.S. Air Force, valued at up to $142 million. This contract includes the delivery of eVTOL aircraft, pilot training, and developing maintenance operations, enhancing Archer’s credibility and market position.
However, Archer Aviation reported an increasing net loss, from $59.2 million in Q1 ‘22 to $113 million in the first quarter of the current year. Despite these figures, the company’s partnerships and potential for future sales provide a promising outlook for investors. Archer Aviation’s cash reserves, bolstered by the relationship with Stellantis (NYSE:STLA), offering an additional $150 million in financing, present a solid foundation for sustained development and operations.
On the date of publication, Tomas Levani 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