IFF Stock Price and the Flavor Industry

The global flavor and fragrance industry is an essential, albeit often overlooked, sector powering a multitude of consumer goods industries. All of the new NA seltzer and beer flavors, all the flavor trends and tik tok recipes, ice cream and confections and even down to viral hits like the Pumpkin Spice latte – all are from a centralized flavor company!

International Flavors & Fragrances (NYSE: IFF) stands as a juggernaut in this domain, producing flavors, fragrances, and specialty ingredients that are integral to food, beverages, personal care, and household products. Investors tracking IFF’s stock price and the broader flavor company stocks have reasons to be intrigued, flavor isn’t going anywhere. Sure, trends change, but these flavor suppliers are on the forefront of flavor innovation.

Why the Flavor Industry Matters

Flavor companies like IFF, Givaudan, Brookside and Symrise are at the heart of innovation in food and beverages. They help brands deliver taste and scent experiences that drive customer loyalty. As consumers demand healthier, sustainable, and more innovative products, the flavor industry is responding with advancements in natural ingredients, plant-based solutions, and clean-label products.

The global flavor and fragrance market is expected to grow at a compound annual growth rate (CAGR) of 4.9% from 2023 to 2030, driven by emerging markets, increasing health awareness, and the rising demand for processed foods. This steady growth trajectory positions flavor companies as attractive investment options.

IFF: A Leader in the Pack

Recent Stock Performance

As of late 2024, IFF’s stock price has seen mixed performance, influenced by broader market trends, raw material costs, and integration challenges following its 2021 merger with DuPont’s Nutrition & Biosciences unit. However, analysts often view dips in IFF’s stock price as potential buying opportunities, considering its strong fundamentals and diversified portfolio.

Key Growth Drivers

1. Innovation in Plant-Based and Natural Flavors: IFF is leading the way in creating sustainable, natural solutions to meet consumer preferences.
2. Global Expansion: IFF’s presence in emerging markets, especially in Asia-Pacific and Latin America, provides access to high-growth regions.
3. Partnerships and M&A: IFF’s merger with DuPont’s Nutrition & Biosciences expanded its product offerings and market reach.

The Competitive Landscape

While IFF is a leader, it isn’t the only player in the game. Let’s compare some of the top flavor companies:

• Givaudan: Based in Switzerland, Givaudan is the largest flavor company globally, with a focus on luxury fragrances and health-oriented flavors.
• Symrise: A German competitor with a strong presence in natural and organic flavors.
• Takasago International: A Japanese flavor house specializing in Asian-inspired taste solutions.

Each of these companies has unique strengths, but IFF’s scale, R&D investments, and diversified portfolio make it a standout for investors seeking exposure to this industry.

Investing in Flavor Stocks: What to Watch

1. Market Trends

The health and wellness trend is driving demand for natural and plant-based flavors, creating opportunities for companies like IFF.

2. Commodity Prices

Raw materials like citrus oils and vanilla can be volatile. Investors should watch for fluctuations in commodity prices and their impact on margins.

3. Innovation and Sustainability

Flavor companies are under pressure to innovate and align with ESG (Environmental, Social, and Governance) standards. IFF has made strides in sustainability, which can be a competitive edge. Things like meat substitutes and gluten free breads. Food items that taste like the OG but are much healthier or cater to dietary restrictions.

4. Earnings and Guidance

Review quarterly earnings for insights into revenue growth, margin expansion, and integration of recent acquisitions.

Conclusion

Investing in flavor company stocks like IFF offers a unique way to tap into the consumer goods sector’s backbone. With steady demand, innovation in health-oriented products, and a growing market in emerging economies, these stocks can add flavor to any portfolio.

However, investors should keep an eye on market trends and company fundamentals before taking a bite. The trump tarrifs and economy uncertainty could lead to greater pain before IFF and others rebound.

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Getting in on the Gene-Editing Wave: Should You Buy CRSP Stock?

Investors who witnessed Moderna’s (Nasdaq: MRNA) meteoric rise during the pandemic know just how profitable new biotechnology companies can be. As a pioneer in gene-editing medicines, CRISPR Therapeutics (Nasdaq: CRSP) could be another up-and-coming biotech stock that you want to keep your eye on.

In December 2023, CRISPR received approval from the FDA to treat sickle cell disease (SCD) and beta-thalassemia with its landmark drug, CASGEVY. However, despite this breakthrough, CRSP stock is down 15% in 2024. 

CRISPR’s Breakthrough Treatment

To start, investors should be careful buying CRSP stock as its success depends almost entirely on CASGEVY over the short term. CRISPR currently has 5 other drugs in clinical programs. But, CASGEVY is its only FDA-approved therapy. For investors, this means that CRISPR’s price will likely be very volatile in the short term. Any good news around CASGEVY will likely send the stock soaring, while bad news could do the opposite.

Despite its limited portfolio of approved drugs, CRISPR’s future seems very strong. Its approved drug, CASGEVY, is a potential cure for sickle cell, a debilitating and life-threatening disease. The company also has 15 more drugs in its pipeline including therapies for hemoglobinopathies, oncology, and regenerative medicine.

Additionally, the company is led (and co-founded) by Emmanuelle Charpentier. Emmanuelle received the Nobel Prize in Chemistry for her work on the CRISPR/Cas9 gene-editing system. This just goes to show how cutting-edge CRISPR’s treatments are.

We also can’t discuss CRSP stock without also talking about Vertex Pharmaceuticals (Nasdaq: VRTX). 

CRISPR and Vertex Pharmaceuticals (Nasdaq: VRTX)

Vertex Pharmaceuticals owns 60% of CRISPR’s gene editing therapy for CASGEVY.

Right now, CASGEVY is in a bit of an exploratory phase. It has been approved by the FDA for use in the United States and the United Kingdom. In the US FDA trial, the drug was administered to 31 patients with 93.5% experiencing no major ill side effects. Now, it’s on doctors across the US and UK to recommend this treatment to their patients. When that happens, Vertex will own 60% of all sales and CRISPR will receive 40%.

On one hand, this will undoubtedly take a bite out of CRISPR’s potential profits. However, Vertex and CRISPR plan to charge $2.2 million for CASGEVY treatments. CRISPR’s cut of any prescribed treatments would presumably be 40% of $2.2 million or $880,000 per treatment – still incredibly high for one product.

Additionally, from what I’ve read, Vertex has significantly better commercialization abilities than CRISPR. It’s a bigger company with a much wider influence which will help bring CASGEVY to market and make it more readily available for patients. So, this partnership may actually work out in CRISPR’s favor.

Crispr Technologies Most Recent Quarter

As a cutting-edge biotech company, Crispr Technologies’ income has been all over the place over the last three years.

1. 2023: Annual revenue of $371.2 million and a net loss of $153 million
2. 2022: Annual revenue of $1.2 million and net loss of $650 million
3. 2021: Annual revenue of $914.9 million a net income of $377 million

This type of variability is not uncommon for early-stage biotech companies. These types of companies often spend years churning through investors’ money while they work to develop cures. However, once they’ve developed a viable treatment, revenue and income can go parabolic. Could this be what’s in store for CRSP stock?

Should You Buy CRSP Stock?

Buying early-stage biotech companies is a bit of a gamble.

On one hand, CRSP stock certainly seems poised for a breakout. The company received critical approval for a life-changing drug and yet the stock is down YTD. The company also has a Nobel Prize-winning CEO in charge, which is a great sign of things to come. Crispr Technologies has the potential to do amazing things in the medicinal field over the coming years. If its gene-editing treatments are successful then the stock will undoubtedly soar.

Red Flags to consider. 

For example, how many people will actually buy CASGEVY? According to the FDA, sickle cell impacts just 100,000 people in the US, or 0.0003% of the population. And, for those who have sickle cell, how many will be able to actually afford CASGEVY given its immense price tag of $2.2 million dollars? These questions are difficult to estimate, especially given the US healthcare system’s convoluted use of insurance policies to pay for treatments.

Finally, it’s worth mentioning that CRISPR already trades at a valuation of $4.75 billion. Some could argue that the company is immensely overvalued, considering its reported revenue of just $504,000 last quarter. On top of that, sickle cell affects a small portion of the US population. An even smaller percentage of those impacted will actually be able to afford CASGEVY. Finally, when CASGEVY revenue starts coming in, CRISPR will only receive 40%.

CASGEVY approval could be a sign of positive things to come.

It’s important to remember that CASGEVY is just one treatment for a handful of diseases. But, CASGEVY is also based on cutting-edge gene-editing technology. If CRISPR can use its gene-editing therapies to treat more common diseases – cancer, heart disease, etc – then the company’s $4.75 billion valuation might seem incredibly cheap. Who knows how long this type of diversification might take. But, it’s a very positive sign that CRSP stock has upward potential over the long run.

If you’re interested in buying CRSP stock, it might be wise to consider doing so slowly over time. This can help protect you from dramatic swings in the stock’s price. 

I hope that you’ve found this article valuable when it comes to learning about CRSP stock. If you’re interested in learning about other gene editing stocks click here, or please subscribe below to get alerted of new investment opportunities from InvestmentU.

Disclaimer: This article is for general informational and educational purposes only. It should not be construed as financial advice as the author, Ted Stavetski, is not a financial advisor. Ted also did not own CRSP stock at the time of writing.

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Making an Informed Solana Crypto Price Prediction

When we first started writing about Solana, it is was trading for around $3.50 a token (it’s currently at $165). At that time, making a Solana crypto price prediction didn’t make sense yet. After all, it was pretty new back then. But still, we liked what we saw. The foundational blockchain behind Solana crypto looked strong then. And it looks even stronger now.

At the time, Solana was still very much a speculative investment. But speculators who took the chance have seen a huge increase in value of Solana crypto. And this comes despite a drop-off at the end of 2021 and bear market through ’22 and ’23. However, the next several months or so could be just as interesting.

What caught our attention was the three-point plan to revolutionize the way crypto transactions work. At the time, there were a swath of “to-the-moon” rug pulls and scam coins that seemed to be getting released every week. In fact, some estimates suggest that DeFi (decentralized finance) rug pulls and exit scams make up 99% of all fraud in the crypto markets.

But Solana crypto came to the table with a plan. It didn’t just promise to reward investors. The company started making good on its plan. It also happens to be rewarding investors in the process. That’s why we’re so bullish on this relatively new crypto. And we’re not the only ones. Trading volume has been way up on Solana crypto since it skied to upwards of $250 in the fall of 2021.

Naturally, as exposure grows, there will be ups and downs in line with the greater crypto markets. But it’s a lot easier to make an educated guess about a Solana crypto price prediction now… since it appears it’s just starting to warm up.

Succeeding Where Others Fall Short

Solana crypto’s founder famously published a white paper draft that laid out a new timekeeping technique called Proof of History (PoH). This proposal was developed to fix one of the major limitations cryptos like Bitcoin and Ethereum faced in terms of scalability. You see, the time that’s required to reach a consensus on transactions was largely seen as a major drawback. But PoH was a way to automate that whole process… And it could act as a crucial element that would allow crypto networks to scale beyond their previous capabilities.

The white paper generated a lot of attention. It wasn’t long before Solana Labs formed. And it began recruiting engineers from the likes of Qualcomm (Nasdaq: QCOM) and Apple (Nasdaq: AAPL). Within a couple of years, the team had raised $20 million to fund its new crypto network. And less than a year later, Solana crypto was launched.

In the process, the core team behind Solana has proven the success of the PoH model. The records (or “blocks”) for most cryptos are limited in size and frequency. And that can dramatically slow down transaction times. The PoH model fixes this problem. But the Solana network also uses a Proof of Stake consensus algorithm, which helps keep the network secure.

Solana crypto is also currently exploring ways to reduce transaction fees. When these fees were first introduced, they were a means to keep bad actors from overloading crypto networks. But the speed of the PoH model largely reduces this problem. That makes it cheaper to transfer coins from one wallet to another.

And lastly, Solana crypto excels at avoiding confirmation delays… This just means it won’t take as long for deposits to be processed. In fact, Solana has proven to be able to process 50,000 transactions per second, with a transaction fee of just $0.00001. Not too shabby compared to other tokens.

A Solana Crypto Price Prediction: Why It Still Has Plenty of Upside

Despite the wild moves in value and the technical breakthroughs, it’s important to keep in mind one important detail: The Solana crypto network is no longer in its beta stage. Investors now have access to staking rewards – which seems to be the norm these days. But that’s why a Solana crypto price prediction is so hard to pin down.

The upgrade is now live, and it’s anybody’s guess as to how high Solana crypto can go. But it’s certainly not out of the question that it could reach a triple-digit valuation by the end of the year… especially if it stays on its current production timetable and volatility dies down.

Solana has already shaken up the crypto community. And now that more investors are sitting up and taking note, we’ve got a pretty good feeling that Solana’s future is bright. It set out to revolutionize the way crypto transactions take place. We’re seeing it do that in real time now. In the process, it’s making a whole lot of people’s crypto wallets feel a little bulkier these days, with even more to come.

Even now in 2024, it still has tremendous upside. It hasn’t kept up with the surge in bitcoin, it still follows all of the same fundamentals that make it strong, and it could potentially be in line for the next crypto ETF.

The Bottom Line on the Solana Crypto Price Prediction

Part of what makes the crypto markets so fascinating is that they’re driven by innovation. Another part is that they’re knocked back down by headlines. Crypto expert Andy Snyder has long described crypto as the very definition of a headline-driven market. And it’s true. A tweet from the right person can send the value of a token skyward in a moment’s notice. But Solana isn’t some meme-based token. It’s built on a solid foundation. Don’t expect to see a TITAN-type situation here.

This makes a Solana crypto price prediction a lot easier to make. We don’t expect to see Elon Musk or Mark Cuban making statements about it. But we do expect Solana crypto and the network it’s built on to continue down its path of innovation. So as long as the crypto markets stay relatively healthy, Solana should continue its upward trajectory well past the $100 mark. And in a matter of a few years, if it does indeed become one of the standard cryptos – as we think it could – it should be worth a whole lot more than that.

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Understanding the Puts vs Calls Ratio: A Key Indicator for Market Sentiment

In the dynamic world of trading, the “puts vs calls ratio” stands out as a crucial analytical tool used by investors to gauge market sentiment and potential directional movements in market indices. This ratio, by comparing the volume of traded put options to call options, provides a glimpse into the collective investor psychology, revealing whether the market is leaning towards bullishness or bearishness.

What is the Puts vs Calls Ratio?

Definition and Calculation

The puts vs calls ratio is calculated by dividing the number of traded put options by the number of traded call options. A put option is a contract that gives the owner the right, but not the obligation, to sell a stock at a predetermined price within a specific time frame. Conversely, a call option gives the owner the right to buy a stock under similar conditions.

Tools: Option Calculator

Formula: Puts vs Calls Ratio = Number of Puts / Number of Calls

Interpreting the Ratio

• Above 1.0: Indicates that more puts are being bought than calls. This suggests that investors are expecting the market to decline, reflecting bearish sentiment.
• Below 1.0: Implies more calls are being bought than puts, hinting at a bullish market expectation.
• Equal to 1.0: Suggests a balanced market view among traders with equal expectations of upward and downward movements.

Significance of the Puts vs Calls Ratio in Market Analysis

The puts vs calls ratio is more than just a number; it’s a powerful indicator of market mood that can signal shifts before they happen.

Bearish and Bullish Indications

• High Ratio (>1.0): A high ratio often predicts a bearish market. It might indicate that investors are hedging against a potential downturn or speculating on a decline.
• Low Ratio (<1.0): Conversely, a low ratio typically signals bullish conditions, suggesting that traders are confident in future market gains.

Market Extremes and Contrarian Indicators

Smart investors watch the ratio closely for extremes. If the ratio reaches unusually high or low levels, it could indicate that the market is due for a reversal. Contrarian investors might use this data to look for buying opportunities in a seemingly over-pessimistic market or to sell when the market appears overly optimistic.

Practical Applications of the Puts vs Calls Ratio

To effectively use the puts vs calls ratio, investors integrate it with other technical tools and market data, ensuring a well-rounded approach to market analysis.

Hedging Strategies

Traders might use this ratio to determine when to hedge their portfolios. A rising ratio could be a prompt to hedge against a potential decrease in market values.

Timing Entries and Exits

The ratio can also help in timing market entries and exits. A sharply increasing ratio might suggest that it’s time to consider taking profits on a bullish position before the expected downturn.

Market Sentiment Analysis

Combining the puts vs calls ratio with other sentiment indicators like the VIX (volatility index), market breadth, and bull/bear polls provides a deeper insight into market psychology and potential movements.

Case Studies

Example 1: The Financial Crisis of 2008 During the 2008 financial crisis, the puts vs calls ratio spiked, as traders rushed to buy puts to hedge against further market declines. Those monitoring the ratio would have seen a clear signal of the increasing bearishness in the market.

Example 2: The Bull Market Rally of 2013 In contrast, during the strong bull market of 2013, the ratio was significantly lower, indicating predominant bullish sentiment as more traders were buying calls to profit from rising stocks.

Conclusion

The puts vs calls ratio is a nuanced tool that, when used correctly, can provide insightful glimpses into market sentiment and potential trends. Traders and investors who monitor this ratio can enhance their understanding of market dynamics, better manage their risk, and position their portfolios strategically in various market conditions.

Read: Puts vs Calls Explained

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Why Aren’t More People Talking About MULN Stock?

At first glance, Mullen Automotive (Nasdaq: MULN) might seem like just another electric car startup. But, this EV maker has a pretty unique story that should make it incredibly interesting to stock market investors across the country. I’m honestly not sure why more people aren’t talking about it. That said, here’s everything you need to know about MULN stock – including whether or not you should buy it.

MULN Stock, a Quick History

Mullen Automotive is one of the least-talked-about, yet fascinating stock stories of the past few years. Mullen is a Southern California-based electric vehicle company that specializes in commercial trucks. But, what separates Mullen from a lot of other EV companies is its stock volatility. I say this because MULN stock was first listed at around $132,750 per share. Over the course of a few years, MULN stock has soared to a high of $362,925, before plummeting all the way down to just $4.55.

So, I know what you’re thinking – why would any long-term investor be interested in a company that’s this adept at value destruction. And the answer is: They wouldn’t be. I mean, Mullen Automotive lists these three risk factors at the beginning of its Form 10K:

• We have incurred significant losses since inception, and we expect that we will continue to incur losses for the foreseeable future
• We will require substantial additional financing to effectuate our business plan
• We have not yet manufactured or sold a significant number of vehicles to customers. Many of our products are still on the development stage and we may never be able to mass-produce them

Yeah, after reading that, I’m sure investors are just lining up with their checkbooks open. But, short-term traders might be interested in MULN stock for the volatility. After all, there are not many companies whose stock prices can surge this widely in price. To get a better idea of why MULN stock is so volatile, we have to talk about Mullen’s financing strategies.

Mullen’s Financing Strategy

On its Form 10K, Mullen reported just $366,000 in sales for 2023, based on invoicing for 35 total cars. At the same time, it reported $215 million in administrative expenses and over $700 million in financing expenses. In total, the EV startup lost roughly $1,006,658,828. So, what happened?

The team over at InvestorPlace did some digging into these numbers and discovered a few interesting takeaways:

1. Mullen’s enormous financing costs mainly stemmed from the company’s convertible notes.
2. Mullen issued $150 million worth of convertible notes in June 2022 in addition to other promissory notes.  
3. The kicker is that Mullen allowed bondholders to convert their notes at the closing price of common stock while also issuing 1.85 bonus warrants for every share converted. The result was that Mullen Automotive spent $427.5 million to raise $150 million in fresh capital.
4. Mullen used this same strategy a second time, raising $145 million but costing the company $255 million in warrant liabilities and almost $100 million in share issuances. 

Mullen is required to report these non-cash charges as “real” expenses – even though they mainly exist on paper. The real cost is for shareholders, who experience dilutions in the value of their shares. In other words, Mullen kept releasing new shares to raise more money, which made existing shares less valuable. InvestorPlace estimates that if you owned 1% of the company in 2023, your stake would have been diluted 98.7% by year-end to an ownership stake of just 0.0133%. 

I’m genuinely not sure why the company did this. I can’t imagine that it was an accident. So, I’d assume that the company’s management was just doing everything and everything to keep the lights on. But, at the same time, the company paid CEO David Michery $48,879,463 in stock awards, along with a salary of $750,000 in 2023. 

MULN Stock Price

Another issue plaguing Mullen Automotive is that its stock price keeps tanking. A company’s stock is essentially a way for it to raise money. If the stock price is soaring then so will the company’s valuation, which makes it easier to raise more money (by issuing more shares) or borrow money at attractive rates. For example, the GameStop Short Squeeze actually helped reinvigorate the company.

However, the reverse happens when a company’s stock price is falling. A lower market valuation makes it harder for the company to attract investors or borrow money. The stock can even be delisted from exchanges if the stock price falls below a certain level.  It’s a bit of a doom spiral downward.

Should You Buy MULN Stock?

As mentioned, almost no rational investor would want to buy Mullen Automotive stock for the long term. This is mainly because the company has a proven history of diluting its stock price and destroying its value. But, the company’s stock price experiences crazy fluctuations, which means there may be some opportunity for traders.

Mullen Automotive’s stock is inherently volatile because it’s such a small company. It currently has a market cap of just under $30 million and an average volume of 740,000. In other words, the company is fairly cheap and there are not a lot of shares trading hands each day. This creates the opportunity for massive swings in the value of shares. 

It’s fairly common for share prices of smaller companies to swing 20%, 30%, or even more in a single day. But, these types of price swings almost never happen for bigger companies. For example, companies like Boeing (NYSE: BA) or McDonald’s (NYSE: MCD) would rarely ever move more than 10% or more in a single day. 

With this in mind, you may be able to take advantage of dramatic changes in Mullen’s stock price, assuming you have information on the company that other investors don’t. If you know something that others don’t, then there might be an opportunity to buy/sell shares before the market reacts to the news. To do this, I’d recommend following along closely with the company on social media. You can sometimes hear about major updates that take place at the company before they are picked up by news outlets. This gives you the opportunity to arbitrage the information and make the corresponding trade.

I hope that you’ve found this article valuable when it comes to learning about MULN stock and whether or not you should buy it. If you’re interested in reading more, please subscribe below to get alerted of new articles from InvestmentU. 

Disclaimer: This article is for general informational and educational purposes only. It should not be construed as financial advice as the author, Ted Stavetski, is not a financial advisor. 

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(TAAS) Transportation As A Service – The Future of Transportation

Transportation as a Service (TaaS) is rapidly growing and is considered by many to be the future of transportation. Through TaaS, car ownership rates will eventually decline. Instead of owning a car, people will be able to buy trips, miles or experiences without having to maintain their own vehicle.

What is TaaS – Transportation as a Service?

Not long ago, owning a car was a mark of adulthood. It was a sign of independence, as well as a way to get to and from work. Over the years, this situation has gradually started to change. Urban areas have grown, which has made public transportation more common. Thanks to carbon dioxide levels, mankind is now searching for ways to reduce our carbon footprint. TaaS is one potential solution.

TaaS is a new mindset. Instead of focusing on car ownership, TaaS involves renting vehicles and similar practices. For instance, Uber and Lyft are both examples of TaaS. Instead of having to own your own car, you can use a ridesharing app to hire a car when you need a ride.

TaaS is similiar to Mobility as a Service (MaaS). While TaaS may involve an app like Uber and a human driver right now, this will not always be the case. In just one to two years, Goldman Sachs expects the first semi-autonomous car to become commercially available.

TaaS is important because today’s cars spend most of their time parked. Across the globe, the typical vehicle is idle during 95% of the day. Connected cars and rideshares can get rid of this idle time. Instead of multiple people using their cars to commute to work each day, the same people could rent a car and forego car ownership.

What is TaaS Technology?

In many cities, TaaS vehicles will be available 24 hours a day. While the average person only uses their car about 4 percent of the time, a TaaS vehicle will typically be used for 10 times more minutes each day. TaaS will work like public transportation does today, but it will blend private transportation providers into a gateway like an app. Then, people can access the gateway whenever they need to reserve and pay for a ride.

If you drive 15,000 miles per year, you can expect to spend an average of $8,469 a year on your vehicle. You have to pay for car insurance, gas, maintenance costs and car payments. By switching to TaaS, you could save hundreds or thousands of dollars per year.

Other than saving money, many people choose TaaS to get more free time. If you do not have to drive on your commute, you can work on something else. Then, you can enjoy spending time with your family once you return home. During your commute, you can also spend time learning a language, reading a book or enjoying your favorite hobby. In 2018, the average American spent 225 hours commuting. To put this in perspective, it only takes 480 hours to learn Spanish. And It takes around 45 hours to drive from the Atlantic Ocean to the Pacific Ocean.

TaaS has already been adopted by a wide variety of companies. DoorDash, GrubHub, Amazon Prime Delivery and Postmates already deliver products to homes across the country. Through WaiveCar or Turo, you can even lease your personal vehicle or find a vehicle you can lease. Other car rentals like Getaround, Zipcar and aGo will let you rent a vehicle whenever you need it. Meanwhile, Ridesharing, GoNanny, Uber, Zimride and Lyft offer rideshare services.

What Are the Consequences of Transportation as a Service?

The first car dealership in the United States was established in 1898. Since that time period, dealerships have followed a fairly basic business model. To prevent automobile manufacturers from competing with dealerships, many states required dealerships to serve as the middleman. Through TaaS and self-driving cars, this entire business model may change. Eventually, manufacturers may even sell vehicles directly to consumers.

If consumers purchase a vehicle at all, it will only be for a short period of time. While there are many ways that TaaS could be implemented, one option is for a self-driving car developer like Tesla or Google to own an entire fleet of self-driving cars. Then, the customer can pay per mile or minute. Because self-driving cars do not require a human driver, the cost of renting a vehicle will drop significantly.

Lower demand for vehicles means that there will be decreased demand for parking lots and garages as well. Normally, parking lots earn money by renting out parking spaces by the hour, day or month. If people pay for rides instead of owning cars, the need for parking lots would be almost eliminated.

Is TaaS a Good Investment?

Companies that sell self-driving cars are likely to perform well if TaaS leads the way forward. Other manufacturers may struggle because fewer people will be purchasing cars. Additionally, companies that run parking lots and garages will end up earning less. Eventually, many parking lots and garages in big cities may be sold and converted.

TaaS is conveniently built around four macro trends. Other than environmental, social and corporate governance (ESG) investing, it incorporates connectivity, the gig economy and electric vehicles. Eventually, the TaaS industry will become an $8 trillion marketplace as it expands into areas like drone delivery, freight, distribution, food delivery and personal transport.

These trends are already taking place. As more people turn to TaaS options, car sales have fallen. Global vehicle sales dropped by 22% in 2020. Even without the pandemic, auto sales fell by 4% in 2019. This decline was the first time in a decade that vehicle sales dropped.

TaaS Could Be 10x Cheaper

According to some estimates, TaaS will be 10 times cheaper than traditional car ownership. Unlike traditional car ownership, you will not have to change the oil or look for a parking spot. Already, the market is responding to these changes. In 2009, Uber initially opened up. Within just seven years, Uber was already booking more rides than the entire American taxi industry.

The iGeneration has fueled the surge in TaaS usage. Back in 1983, more than 50% of teenagers had a driver’s license by the age of 16. In 2016, only 25 percent of teenagers had a license by the same age. These young people are using TaaS to hang out with friends, go to restaurants and visit their favorite shops.

Ultimately, the biggest takeaway is that investors and cities need to prepare now. As the transportation industry adapts and changes, everyone else will have to adjust as well. From fewer parking garages to reduced vehicle sales, TaaS is going to have a major impact on specific industries. While the overall impact of TaaS is going to be positive, there will be significant growing pains along the way.

Disrupters Reshape Industries

The following ideas come from Trends Expert Matthew Carr who has been closely following (TaaS) technology as a service and its broader impact.

Over the past couple of decades, we’ve witnessed disrupters completely reshape industries. Facebook (Nasdaq: FB) and Twitter (NYSE: TWTR) launched new ways for humans to communicate and interact. Social media is now one of the most powerful advertising platforms in the world.

The streaming service Netflix (Nasdaq: NFLX) not only created a model that dozens of other companies now emulate but also produces some of the best content out there. The studio receives scores of Oscar, Golden Globe and Emmy nominations and awards each year.

E-commerce giants Alibaba (NYSE: BABA) and Amazon (Nasdaq: AMZN) are the templates that the whole retail industry looks to replicate. Tesla (Nasdaq: TSLA) is pulling the entire automotive industry toward mass electric vehicle adoption.

In real estate, there’s Opendoor Technologies (Nasdaq: OPEN) and Zillow Group (Nasdaq: Z). And in finance, there’s Bitcoin and the defi movement. Not to mention the potential for blockchain. The list goes on and on. Many early investors in each of these disrupters have been rewarded with life-changing returns.

What are the TaaS Stocks?

Now, in TaaS, Uber (NYSE: UBER) and Lyft (Nasdaq: LYFT) have flipped the ride-hailing industry on its head. In fact, long-coveted taxi medallions in New York and other cities have plummeted in value. And these two stand to benefit in the continued expansion of TaaS over the next couple decades.

But these companies are far from equals. Lyft posted annual revenue in 2021 of $3.2 billion and is projected to leap more than 41% to $4.33 billion in 2022.

Uber – thanks to Uber Eats and its recent acquisition of Drizly – posted revenue of $17.4 billion in 2021 and is projected to see 2022 revenue jump 28% to $22.32 billion.

And in the American ride sharing market, Uber is the more dominant force. It currently controls 68% of the market, while Lyft holds the rest.

But what’s amazing is, that very few consumers use both. This is an interesting data point. You see, many Americans rely on subscriptions to Netflix, Hulu, Disney+ and Amazon Prime Video. Though, when it comes to ride-sharing, only 10% of consumers use both Uber and Lyft.

Latest TaaS Technology Companies to Watch

But there’s a new disrupter about to go public. Joby Aviation (NYSE: JOBY) is hoping to bring some of this sci-fi magic to millions of commuters. Over the past 10 years, the company has developed a zero-emission, all-electric, vertical takeoff and landing (eVTOL) aircraft designed to leapfrog traffic congestion.

Each aircraft will carry one pilot and four passengers for journeys of anywhere from 5 to 150 miles at a top speed of 200 mph. These are the taxis of the future. The next evolution in ride-hailing after Uber and Lyft. In fact, Uber was working on this idea but sold its segment to Joby in December. And it agreed to make a $75 million investment in the company.

Joby’s eVTOL taxi concept received a $394 million investment from Toyota (NYSE: TM) as well. The company’s goal is to save 1 billion people an hour of commute time each day and to accomplish this in an environmentally friendly way.

Joby plans to have commercial passenger aircraft in operation as early as 2024. And once these are up and running, its business should, literally, take off.

Revenue Forecasts

The company forecasts it will make $721 million in revenue by 2025. And it projects that number will more than double by 2026. By then, the company believes each aircraft will generate $2.2 million in annual revenue with roughly 850 plans in service.

Over the next decade, Joby plans to have a total of roughly 14,000 vehicles generating $20 billion in revenue. It expects to have a presence in at least 20 cities worldwide, with recurring revenue from its aircraft segment accounting for more than 50% of annual sales.

These are lofty forecasts. But Joby is further ahead than its competitors are. Joby went public through a merger with the special purpose acquisition company (SPAC) Reinvent Technology Partners (NYSE: RTP).

This deal valued the company at $6.6 billion. That seems steep considering there is no real revenue yet. But the opportunity for the air mobility market is upward of $500 billion in the U.S. Globally, this opportunity is forecast to top $1 trillion.

TaaS is not only the future of transportation, it’s one of the most dominant forces in the market right now. But over the next couple of years, it’s going to evolve rapidly and you could get in on the ground floor.

Stay tuned for the latest investing news on TaaS and other emerging technologies.

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