We recently compiled a list of the 10 Best TaaS Stocks to Invest in According to Hedge Funds. In this article, we are going to take a look at where Joby Aviation, Inc. (NYSE:JOBY) stands against the other TaaS stocks.
Market experts opine that the transportation world is surrounded by tech-infused transformation, which creates significant opportunities for investors to go long on TaaS (transportation-as-a-service) stocks. The digital transformation that is being experienced by the transportation sector continues to make delivery services more accessible and customized.
As per Introspective Market Research, factors including the need for on-demand, affordable, and eco-friendly transport solutions are expected to drive the growth of the transportation-as-a-service market.
Technological advancements including self-driving cars are some of the prominent factors, with healthy improvement in connectivity. Smart cities and the application of loT, primarily in the transportation sector, should also act as contributing factors.
How Technological Advancements Will Drive Growth of the TaaS Market?
The TaaS market saw a transformative shift over the recent past, courtesy of the integration of Artificial Intelligence (Al) and Machine Learning (ML). Al-powered systems tend to optimize fleet operations by analyzing real-time and historical data, predicting vehicle demand, and suggesting efficient routes. ML algorithms focus on analyzing user behavior, preferences, and travel history to offer recommendations. Therefore, both the technologies, Al and ML, have transformed demand forecasting and predictive analytics.
As per Successive Digital, deep learning models, mainly Recurrent Neural Networks (RNNs) and Long Short-Term Memory (LSTM) networks, are proficient enough to capture temporal dependencies in data, which helps in demand forecasting. Notably, ML models like ARIMA (Autoregressive Integrated Moving Average) and Prophet are used to predict future demand by studying time-series data.
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Key Trends to Watch Out in 2025
One of the most important trends likely to drive the growth of the TaaS market in 2025 is the rapid adoption of EVs. The global push towards sustainability continues to support the growth of the EV market. Introspective Market Research believes that stringent emission standards set by governments and incentives provided for EVs continue to support the adoption. Furthermore, the development of battery systems focused on enhancing the driving range and cutting down the cost of EVs should make them affordable to consumers.
Next, Mobility as a Service (MaaS) integration should continue to fuel growth in the TaaS market. MaaS platforms focus on the convenience of users by offering a one-stop app where people can locate modes of transport such as buses, trains, bicycles, ride-hailing, etc. As per Introspective Market Research, the evolution of digital technologies like real-time data and analytics, mobile applications, and loT supported the growth of MaaS. These technologies focus on integrating and managing different forms of transport services.
Our Methodology
To list the 10 Best TaaS Stocks to Invest in According to Hedge Funds, we conducted extensive research and scanned through several online rankings. After getting an initial list of 25-30 stocks, we filtered out the ones having high hedge fund holdings. Finally, the shortlisted ones were ranked in ascending order of their hedge fund sentiment, as of Q3 2024.
At Insider Monkey we are obsessed with the stocks that hedge funds pile into. The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A futuristic electric vertical takeoff and landing aircraft soaring through the sky.
Joby Aviation, Inc. (NYSE:JOBY)
Number of Hedge Fund Holders: 12
Joby Aviation, Inc. (NYSE:JOBY) is a vertically integrated air mobility company, which is engaged in building an electric vertical take-off and landing aircraft optimized to deliver air transportation as a service in the US and Dubai. The company focuses on providing transportation solutions on a service basis rather than through individual ownership.
Wall Street believes that a successful partnership with Mukamalah Aviation in Saudi Arabia should boost Joby Aviation, Inc. (NYSE:JOBY)’s revenue by leveraging strategic opportunities in a rapidly growing market for advanced air mobility (AAM). The direct sale of aircraft to business customers such as Mukamalah and government partners like the US Department of Defense forms one pillar of Joby Aviation, Inc. (NYSE:JOBY)’s commercialization strategy.
The influx of cash should offer Joby Aviation, Inc. (NYSE:JOBY) crucial funding for scaling up production and continuing research and development efforts. Next, successful launches in markets such as Dubai and Saudi Arabia should serve as a proof of concept for the company’s eVTOL technology, potentially attracting additional partners and customers worldwide.
As Joby Aviation, Inc. (NYSE:JOBY) establishes a track record of successful operations in diverse environments, it is expected to strengthen its position in negotiations with other potential clients and regulators. Joby Aviation, Inc. (NYSE:JOBY)’s technical talent, market position, and progress in FAA certification should remain healthy. Joby Aviation, Inc. (NYSE:JOBY)’s recent accomplishments, like delivering its first eVTOL to Edwards Air Force Base ahead of schedule, strengthen confidence.
Overall JOBY ranks 10th on our list of the best TaaS stocks to invest in according to hedge funds. While we acknowledge the potential of JOBY as an investment, our conviction lies in the belief that some deeply undervalued AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for a deeply undervalued AI stock that is more promising than JOBY but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
