Wall Street bullish on this electric airplane stock. Citi sees a 50% return
Wall Street analysts are bullish on Beta Technologies , even though the electric airplane manufacturer’s stock has tumbled nearly 30% since its Nov. 4 debut on the New York Stock Exchange . Goldman Sachs, Morgan Stanley and Bank of America have initiated coverage of Beta with a buy rating. Citi views the stock as high risk but high reward with a target of $41 per share, suggesting 50% upside. “We believe BETA is best positioned, and the recent selloff provides an attractive entry point,” Goldman analysts led by Anthony Valentini told clients in a Nov. 30 note. Beta is working to certifity two electric airplane models with the Federal Aviation Administration before the end of the decade. One is the conventional take-off and landing CX300 and the other is the vertical take-off A250. Beta is focused on military, medical and cargo flights right now. This strategy avoids the risk factors associated with commercial passenger flight, Citi analyst John Godyn told clients. Beta also has a national charging network advantage with 84 sites. But Beta’s aftermarket services for electric aircraft, particularly batteries, is the business segment that could ensure the company’s long-term profitability, Godyn said. “It’s no longer a secret that lifetime profits on aftermarket parts can easily surpass the profits on the original aircraft sale multiple times over,” the analyst said. Beta is “egineered for profitability from the get-go,” he said. The company debuted in early November, and raised more than $1 billion in its initial public offering . Morgan Stanley, Goldman, Bank of America, Jefferies and Citigroup were among its underwriters.
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