Buy EHang Stock for Flying Car Profits… But Don’t Go All In

Stocks to buy

Having performed over 39,000 trial flights across 14 countries, EHang (NASDAQ:EH) aims to broaden its international presence. This makes EHang Holdings an attractive option for those bullish on China’s tourism sector. EH stock already has strong ties with local tourism boards and is growing its market share in many key markets with its electric vertical takeoff and landing (eVTOL) aircraft.

The company envisions a future with self-flying taxis and aims to be among the key purveyors of this fast-growing space. With a dominant position in the Chinese market for eVTOL aircraft, EH stock has been on quite a journey in recent years.

Indeed, at the beginning of 2021, EH shares soared by nearly 550%, reaching over $129 per share. However, since then, the company’s share price has dipped (to put it nicely), stabilizing around $14 per share. That’s a decline of nearly 90% from its peak, which many investors may remain queasy about, for good reason.

That said, as Chinese regulators (the equivalent of the FAA) have approved EHang’s vehicles, this is a company with the potential to show the world how profitable flying vehicles/taxis can be. Let’s dive into why this stock may be worth a speculative bet, down so far from its peak.

Recent EHang News

In addition to EHang’s core Chinese business, there’s plenty of other recent news for investors to digest.

The company opened its inaugural European UAM Center in Spain at Lleida-Alguaire International Airport (LEDA). This European pioneering center, focused on unmanned eVTOL aircraft, is a global model for seamlessly integrating eVTOL operations with airport infrastructure and air traffic management systems.

EHang, in collaboration with Aeroports de Catalunya, inaugurated a pioneering UAM center, propelling Europe’s aviation and airport sectors to the forefront of Advanced Air Mobility. Notably, the EH216-S eVTOL system received a Type Certificate from the Civil Aviation Administration of China (CAAC) on October 13, 2023, marking a historic achievement as the world’s first unmanned eVTOL to be certified for commercial passenger operations in China.

EHang’s EH216-S at the European UAM Center accumulates invaluable operational data, aiding the development of eVTOL integration solutions. The UAM Center sets global standards with its EASA-compliant vertiport, accumulating knowledge for intelligent eVTOL deployment.

Deliveries of EH216-S Will Start Before Year-End

In October, EHang achieved a pioneering feat in AAM. The EH216-S eVTOL earned the type certificate from the CAAC, marking it the world’s first officially certified autonomous electric air taxi. The company is now pursuing production and airworthiness certificates.

Following the TC grant, EHang is set for a swift rollout of EH216-S units by Q4 2023. The first air taxi customers will receive their aircraft this year. Initially, it will operate with restrictions for safety and integration. EHang plans to monitor new routes closely and add observers for BVLOS operations. High-altitude flights will be introduced gradually for safety, with plans to expand commercial operations step by step.

Buy EH Stock, But Be Cautious

EHang had a market cap of $1.5 billion. The potential exists for a significant share rally if investors get excited. However, concerns over Western regulations may delay EHang’s entry into Europe and the U.S. warranting caution.

Thus, this is among the flying car stocks I think investors would be right to take a flyer on, but it’s not one I would go all-in on just yet. I will monitor this name from here on out to see if there are enough catalysts to justify an investment.

On the date of publication, Chris MacDonald 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 Publishing Guidelines.

Chris MacDonald’s love for investing led him to pursue an MBA in Finance and take on a number of management roles in corporate finance and venture capital over the past 15 years. His experience as a financial analyst in the past, coupled with his fervor for finding undervalued growth opportunities, contribute to his conservative, long-term investing perspective.

Articles You May Like

3 Stocks Poised for a Dramatic Plunge
7 F-Rated Stocks To Sell in July
3 Psychedelic Stocks to Ride to the Moon and Beyond
PC-Tel and Extreme Networks are Aggressive Growth Zacks Rank Buys
The 3 Best Battery Stocks to Buy in July 2024