So-called "flying taxis" are going mainstream, and investors are rushing into shares of the early market leaders.

Joby Aviation (NYSE: JOBY) stock traded up as much as 14.9% at the market open and were up 8.6% as of 10:30 a.m. ET after President Donald Trump signed an executive order aiming to "unleash" development of the company's new flying machines.

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Image source: Joby Aviation.

Markets taking shape

Joby is one of a handful of aerospace companies racing to bring electric aircraft capable of vertical takeoffs and landings, or eVTOLs, to market. It takes time for new designs to win Federal Aviation Administration (FAA) approval, but if all goes well, Joby and rival Archer Aviation could have air taxis in the air as soon as next year.

Late Friday, investors got a look at the potential market for the eVTOLs once they are approved for takeoff. President Trump signed an executive order aimed at "unleashing American drone dominance," which included a mandate that the Department of Transportation advance eVTOLs.

Within 180 days, according to the order, Transportation is to select "at least" five pilot projects that plan to begin eVTOL operations, including advanced air mobility, medical response, cargo transport, and rural access.

Is Joby stock a buy?

There is still a lot that must go right for Joby, including winning FAA certification and proving it can manufacture its aircraft at scale. And Joby already had several customers lined up, including a high-profile deal announced last week with Saudi Arabia to distribute its aircraft there.

Still, the executive order points to the potential of these aircraft to disrupt existing technologies.

Joby carries a market capitalization of more than $7 billion, a lot for a pre-revenue company. But the potential is there. For investors excited about the technology and willing to carry some risk in a diversified portfolio, Joby looks like the leader of the eVTOL pack.

Should you invest $1,000 in Joby Aviation right now?

Before you buy stock in Joby Aviation, consider this:

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Lou Whiteman has positions in Joby Aviation. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Sometimes the best investment opportunities come wrapped in government buzzwords and unrealistic timelines.

Last Friday, the White House issued an executive order called "Unleashing American Drone Dominance." Yes, that's the actual title. And while it's long on ambition and short on specifics, buried in the bureaucratic language is something that matters for growth investors: a clear signal that the administration wants to fast-track electric vertical takeoff and landing (eVTOL) aircraft.

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Image source: Getty Images.

The executive order creates an eVTOL pilot program requiring the FAA to select at least five companies for real-world operations, with aggressive timelines that suggest political pressure to move faster than typical aviation bureaucracy allows.

While the details remain vague and the timelines optimistic, the direction is clear: America wants to lead in urban air mobility. This political tailwind arrives just as the technology reaches commercial viability, creating a rare convergence of innovation, regulation, and market demand.

Now, before you roll your eyes at another government initiative, consider this: Archer Aviation (NYSE: ACHR) and Joby Aviation (NYSE: JOBY) don't need this executive order to succeed. Both companies are working through FAA certification (though timelines for experimental aircraft are notoriously opaque), have secured major airline partnerships, and claim to be targeting commercial launches shortly.

What both companies are getting is something potentially more valuable -- political cover to move faster through the regulatory maze. Both stocks have already had massive runs over the past 12 months (Archer up 203%, Joby up 63%), but if you think flying taxis are still science fiction, you haven't been paying attention. Here's why these two pioneers look like buys even after their recent runs.

Archer Aviation: The execution story

Archer Aviation operates with remarkable efficiency for a pre-revenue company, achieving milestones that arguably justify its $5.6 billion market cap. The company's Midnight aircraft, designed to carry four passengers plus a pilot on trips up to 100 miles, recently completed piloted flights -- a critical step that positions Archer, alongside Joby, as one of America's leading eVTOL companies.

With partnerships spanning United Airlines for domestic routes and Stellantis for manufacturing expertise, Archer has assembled the pieces for rapid commercialization once certification arrives. Its Launch Edition program, securing commitments from Abu Dhabi Aviation and Ethiopian Airlines valued at up to $30 million each, provides early revenue visibility and validates international demand.

The investment case is compelling. Archer's $6 billion order backlog now exceeds its entire $5.6 billion market cap, while its hefty 11.7% short interest (as of mid-May) sets up a potential short squeeze. Though Friday's executive order lacks implementation details, it sends an unmistakable signal -- the U.S. government views eVTOL dominance as a national priority. For a company already executing ahead of most of its peers in many ways, that political validation could be the spark that sends shares soaring in the months ahead.

Joby Aviation: The deep-pocketed pioneer

Joby Aviation brings unmatched financial firepower to the eVTOL race, with $813 million in cash plus Toyota's recent $250 million investment (part of a $500 million commitment) providing runway through commercialization. The company's Q1 2025 achievements read like a pre-launch checklist: routine pilot-on-board transition flights, Virgin Atlantic partnership for U.K. market entry, fifth production aircraft powered on, and expanded Marina manufacturing facility set for June handover.

Joby benefits from Toyota's manufacturing expertise embedded directly in operations, potentially solving the hardest challenge facing aerospace start-ups -- scaling from prototypes to volume production. The company claims to be 62% complete on its side of Stage 4 FAA certification (43% on FAA's side), though investors should view these self-reported metrics skeptically given the opaque nature of experimental aircraft approval. That's not a knock against either company, but the reality of developing a new form of aviation.

With strategic partnerships including Delta Air Lines, Virgin Atlantic, and a $131 million Department of Defense contract, Joby has diversified its path to revenue across commercial, international, and military applications. And like Archer, Joby also sports a fairly high short interest, with 7.6% of outstanding shares sold short in May. As such, this eVTOL pioneer could also benefit form a short squeeze on positive news or a marketwide melt-up.

Why these two eVTOL pioneers are a buy this week

Friday's executive order accelerated the eVTOL timeline, and the market hasn't caught on. While Archer executes lean and Joby brings Toyota's backing, both companies now face compressed regulatory timelines that could pull commercial operations forward by years.

This week's setup is compelling: Heavy short interest creates squeeze potential, operational milestones keep hitting, and a fresh political catalyst has just emerged. So, for growth investors comfortable with volatility, this could be a stellar entry point.

Should you invest $1,000 in Archer Aviation right now?

Before you buy stock in Archer Aviation, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Archer Aviation wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $669,517!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $868,615!*

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George Budwell has positions in Archer Aviation, Joby Aviation, and Toyota Motor. The Motley Fool recommends Delta Air Lines and Stellantis. The Motley Fool has a disclosure policy.

Shares of Joby Aviation (NYSE: JOBY) are flying higher on Wednesday. The company's stock spiked 30.2% as of 2:21 p.m. ET. The jump comes as the S&P 500 and the Nasdaq Composite were mostly flat.

The company, which develops electric vertical take-off and landing (eVTOL) aircraft, announced yesterday after the market closed that it has received $250 million from Toyota, the first tranche in $500 million of previously announced funding.

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Toyota releases its first payment

While the funding was not unexpected -- the total $500 million strategic investment had already been announced -- actually receiving it sparked renewed enthusiasm for the company and its relationship with the storied vehicle maker.

The funds will be used to help Joby attain certification for its eVTOL aircraft as well as to advance its manufacturing and production capabilities. Joby leadership is hoping the relationship will progress, saying that the release of the $250 million "puts the two companies a step closer toward a strategic manufacturing alliance."

Image source: Getty Images,

JoeBen Bevirt, founder and CEO of Joby, added that, "We're already seeing the benefit of working with Toyota in streamlining manufacturing processes and optimizing design. This is an important next step in our alliance with Toyota to scale the promise of electric flight."

Joby looks promising

The news comes on the heels of a damning report on its closest competitor, Archer Aviation, that alleges Archer is misleading investors regarding its development timeline and aircraft capabilities. If these allegations prove true, it would give a massive leg up to Joby in the race to commercial operations. Given Toyota's commitment to quality and reliability and its relationship with Joby, I would be surprised if the company faces similar allegations.

Should you invest $1,000 in Joby Aviation right now?

Before you buy stock in Joby Aviation, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Joby Aviation wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $653,389!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $830,492!*

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Johnny Rice has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Joby Aviation (NYSE: JOBY) stock jumped 6.8% through 10:10 a.m. ET this morning after "beating" earnings last night. Analysts forecast Joby would lose $0.19 per share in its first quarter of 2025, but the electric air taxi company reported a loss of only $0.11 per share.

Joby has no revenue, so analysts didn't bother making a revenue forecast -- and Joby reported no revenue.

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Image source: Getty Images.

Joby Aviation Q1 earnings

Being a pre-revenue company, Joby's "earnings" press release focused on business developments instead. The company noted it has picked a new CFO, Rodrigo Brumana, a veteran of HP, Amazon, eBay "and, most recently, Poshmark."

The company said it has made "progress on the certification of our aircraft," and said it has begun "routine transition flights with a pilot onboard the aircraft, marking a critical step toward starting FAA flight testing."

Perhaps most importantly, Joby said it ended Q1 2025 with $813 million in the bank, and another $500 million investment from Toyota Motor on the way.

Is Joby stock a buy?

That's important because, with no revenue and no cashflow coming in from its business, Joby currently has to draw on its cash reserves to keep itself in business as it moves toward having a product to sell. Last year, Joby burned through $487 million in negative free cash flow, a number that's starting to inch higher in 2025.

The good news is that, with Toyota's backing, the company still has enough money to keep it afloat for nearly three more years before it runs out of cash. The bad news is that analysts forecast Joby won't turn profitable before 2030 -- five years away.

Joby stock remains speculative. If you decide to buy into it, make sure to buy small.

Should you invest $1,000 in Joby Aviation right now?

Before you buy stock in Joby Aviation, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Joby Aviation wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $623,103!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $717,471!*

Now, it’s worth noting Stock Advisor’s total average return is 909% — a market-crushing outperformance compared to 162% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of May 5, 2025

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon, HP, and eBay. The Motley Fool has a disclosure policy.