JOBY's Premium Valuation: A Critical Look at the eVTOL Darling

Looking at Joby Aviation’s current market position, I can’t help but feel skeptical about its lofty valuation. Trading at 12.35X price-to-book value—significantly higher than industry averages and rival Archer Aviation—JOBY seems to be floating on investor optimism rather than solid fundamentals. Both companies sport an uninspiring Value Score of F, but is Joby worth the premium?

I’ve been tracking their recent achievements, and yes, there are legitimate reasons for excitement. Their autonomous defense capabilities demonstration during Resolute Force Pacific was impressive—logging over 7,000 miles across 40+ flight hours. This positions them well for potential Department of Defense contracts and showcases their technological edge.

The acquisition of Blade Air Mobility’s passenger business also looks strategically sound. It gives Joby immediate access to established terminals and loyal customers in key markets like New York and Southern Europe. This could potentially accelerate their commercialization timeline and give them an advantage over Archer Aviation.

Their first flight between two U.S. airports in FAA-controlled airspace marks another milestone, and the expansion of their Marina, CA production site to potentially produce 24 aircraft annually signals serious commercial intent.

But let’s be real about what we’re investing in here. Despite the 72% stock surge over the past 90 days, Joby remains unprofitable with negative returns on equity. Commercial operations haven’t even begun, and the path to profitability looks distant and uncertain.

The eVTOL market faces significant hurdles that investors seem to be glossing over. Regulatory approvals aren’t guaranteed. Infrastructure development will be costly and complex. Consumer adoption remains a massive question mark—will people actually trust these vehicles enough to use them regularly? Safety concerns, noise issues, and affordability questions could severely limit market potential.

Battery technology represents another critical vulnerability. High voltage and thermal issues pose real risks for eVTOL aircraft that could derail even the most ambitious commercialization plans.

When I look at Wall Street’s average target price of $10.57—suggesting a 21% downside from current levels—I can’t help but think the market has gotten ahead of itself. The long-term potential for eVTOLs may be bright, but Joby’s current valuation already bakes in tremendous optimism while ignoring substantial risks.

For my money, this looks like a stock to avoid rather than chase. The promise of flying taxis might be alluring, but at this price point, investors are likely paying for dreams that may take years to materialize—if they ever do.