Jefferies Says This 1 Flying Car Stock Has 70% Upside Potential. Should You Buy It Here?

Shares of Beta Technologies (BETA) are again on investors’ radars after Jefferies gave the electric aircraft manufacturer’s stock a “Buy” rating, owing to a favorable risk-reward profile due to the recent decline. As BETA stock has been trading between $17 and $18, Jefferies’ $30 target implies significant potential upside from the current levels.

The positive rating for BETA stock has come at a time when the advanced air mobility segment is becoming more mature, with regulators and aerospace players pushing for commercialization. While the pre-profit aviation segment remains volatile, Beta Technologies’ strategy of combining conventional takeoff aircraft with vertical aircraft has again attracted the attention of analysts.

Beta Technologies is an electric aerospace company based in South Burlington, Vermont. The company is focused on developing electric aircraft, propulsion systems, and charging infrastructure. With a market capitalization of around $3.9 billion, the company is developing a conventional takeoff and landing aircraft, called the CX300, as well as a vertical takeoff and landing aircraft, called the ALIA 250.

The stock has made a wide range of movements during the last 52 weeks, between $15.61 and $39.50. While BETA stock has made significant movements, it has been trading at much lower levels than its historical highs, although it has gained around 5% during the last five days. While the stock has made significant movements, it has been much more volatile compared to the S&P 500 ($SPX), which has made relatively more stable movements.

From a valuation perspective, it is difficult to apply conventional metrics. The company is still unprofitable, and its price-to-sales (P/S) ratio is 134.95 times based on low revenues. However, using forward enterprise value-to-sales, Jefferies believes that Beta’s shares are trading at approximately 3.2 times forward EV-to-sales for 2028, which is at a discount to its blended AAM peers of 5.7 times.

During its recent quarterly update, Beta announced important business developments, not profitability. For instance, the company has completed its first ALIA CTOL aircraft, which will be used for demonstration flights in Norway with Bristow Group (VTOL). Another aircraft has also been shipped to New Zealand for test flights with Air New Zealand (ANZFF).