Vertical Aerospace (NYSE:EVTL) has completed a US$35.0 million composite units offering, issuing 33,333,334 equity and derivative units at US$1.05 each. This capital raise is a key development for investors to assess.

The fresh US$35.0 million raise lands after a period of heavy share price pressure for Vertical Aerospace, with the stock down sharply over the past year and multi year total shareholder returns also significantly negative. The offering appears to have come against a backdrop of fading momentum and a market that is reassessing both funding risk and long term execution.

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After a fresh US$35.0 million raised at a higher price than the latest close, the question for Vertical Aerospace now is simple: Is today’s discount already attractive, or is patience on entry price still your edge as valuation comes into focus next?

Most Popular Narrative: 98.5% Undervalued

According to the most widely followed narrative, Vertical Aerospace trades far below an estimated fair value of $60. That gap, relative to the last close at $0.89, is what keeps this story front and center for many investors.

To close this opinion piece… Vertical Aerospace is a company I will potentially hold for the years ahead given their apparent trajectory as well as potential for one day being valued at a significant multiple to its current value. 13x sounds incredulous, I know, but even that is currently far less than Archer Aviation and about $10 billion less than Joby Aviation!

Curious what sits behind a fair value nearly an order of magnitude above today’s price? The narrative leans heavily on long term revenue build out and margin potential that only show up once certification, production scaling and commercial operations are fully in motion. The numbers in that fair value model assume a very different earnings profile to today. The step change between current losses and the profit pool implied by that $60 figure is where the real story sits.

Result: Fair Value of $60 (UNDERVALUED)

However, this bullish Vertical Aerospace story still depends on fresh funding and successful VX4 testing; either of these factors could sharply weaken the 98.5% undervaluation case.

Next Steps

Given how mixed the sentiment on Vertical Aerospace is right now, it makes sense to move quickly and check the data that most investors are watching. You can start by reviewing the 6 important warning signs.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.