Key Highlights
- Joby Aviation announced plans to buy defense technology company Resonant Sciences for approximately $500 million ($450M in cash, $50M in shares)
- Shares of JOBY declined 6.5% during premarket hours following the announcement
- The company simultaneously unveiled an at-the-market equity offering program valued at up to $750 million, sparking dilution worries
- After the transaction completes, Resonant will serve as Joby’s defense-focused business unit; the air taxi division will operate independently
- JPMorgan maintains an Underweight stance on JOBY with a $7 price objective, suggesting 32% potential downside
The electric air taxi developer Joby Aviation is expanding its footprint into the defense sector. On Tuesday, the company revealed plans to purchase Resonant Sciences, an Ohio-based firm, for roughly $500 million.
Shares of JOBY dropped 6.5% during premarket hours after the disclosure, though the stock later recovered to finish the session up approximately 1%.
The acquisition will be financed through $450 million in cash alongside $50 million worth of Joby shares. The transaction is anticipated to finalize during the first half of 2027.
Resonant Sciences specializes in designing, producing, and delivering sophisticated radio-frequency and mission systems for United States national security agencies. Following the deal’s completion, Resonant will operate as Joby’s exclusive defense division.
The merged entity will control approximately one million square feet of manufacturing, integration, and testing facilities throughout the Dayton, Ohio area.
Joby’s commercial passenger air taxi operations will remain a distinct entity, maintaining its focus on electric vertical take-off and landing (eVTOL) aircraft designed for civilian transportation.
Alongside the acquisition news, Joby revealed a fresh at-the-market equity offering program valued at as much as $750 million. The company isn’t obligated to sell the complete amount right away. This program provides Joby with the ability to issue additional shares gradually as needed.
However, this financial flexibility brings consequences. The possibility of further shareholder dilution adds another concern for investors as Joby maintains significant expenditures while working toward commercialization.
JPMorgan Recognizes Advancement Yet Maintains Negative Outlook
JPMorgan analyst James Kirby recognized favorable operational developments at Joby. Currently, five aircraft are operational, with an additional 12 progressing through manufacturingāan increase of four from the prior quarter.
Joby is also getting ready to initiate flights through the eVTOL Integration Pilot Program in Texas next month. Flights carrying passengers may commence before the year ends, prior to receiving full commercial certification.
Kirby observed that transporting passengers ahead of complete certification would represent “an incremental positive for AAM.”
Nevertheless, Kirby raised concerns regarding the FAA certification timeline. Stage 5 progressed by five percentage points throughout the quarter, whereas Stage 4 advanced merely one percentage point. According to Kirby, “investors were hoping for more tangible progression.”
Kirby reaffirmed his Underweight (Sell) recommendation and $7 price objective for JOBY, stating “the current progress is fully baked in.” This price target indicates 32% potential downside from present levels.
Analyst Community Shows Mixed Sentiment
Analysts remain divided regarding the stock. The overall consensus stands at Hold, derived from 2 Buy ratings, 2 Hold ratings, and 1 Sell rating.
The mean price target of $13.13 suggests approximately 49% potential upside during the coming 12 months.
Joby projects its total addressable market could ultimately expand to $200 billion to $300 billion across multiple decades, although regulatory certification, competitive pressures, and an untested business model create significant uncertainty moving forward.
The Resonant Sciences acquisition remains contingent on regulatory clearance and is projected to close in early 2027.
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