ARK Invest BUYS EHANG Stock? ️ WARNING! ️
is kathy woods empire of etfs about to buy ehang the e h stock that's really the question that we want to look into today and aim to answer we're going to look at a couple of things we're going to look at what exactly is happening what is this arc x fund when is it happening what's the investment strategy of arc x and we're going to look at the actual arc x research that mentions and analyzes e-hang and what clues that gives us we will also fifthly look at the chart performance of all the kind of key drone stocks in this field and lastly in number six i'm going to tell you my view on what this all means for ehang in the e8 stock so guys let's get straight to it as always this is not financial advice this is for entertainment only and if you enjoy these videos if you're here live from hong kong do smash that subscribe and like button our eq community is exploding we are doubling every 10 days the number of people in our lovely community fans who are excited about adr's new tech evs all sorts of things that we talk about here every single day so let's get straight to it guys and i'm going to show you some of these sources so you also see what i'm looking at this is the actual filing of arc x we're not going to get the whole thing because it's rather lengthy but there are a couple of points i've highlighted this was filed on the 13th of january and after 75 days it because it basically becomes effective they cannot start to offer securities i.e this etf before 75 days that makes it the 29th of march in my book i might well be off by a day or two there but i think it should be the 75th uh 75th day rather it should be the 29th of march end of march basically uh this etf might start to become alive under the symbol arc x arc space exploration etf it sounds very tesla like doesn't it really it sounds exciting so we're going to look at very briefly what is the segment that gets us excited about drones and ehang and i've highlighted that here sub ordered so they have a couple of segments some a couple of sections they talk about um four categories here one being orbital aerospace companies that launch make service operate platforms in the orbital space so that's real space not satellites and things like that and then there's the sub-orbital aerospace companies that launch make service operate platforms in this sub-orbital space so below orbit that's drones air taxis electric aviation vehicles and then there are also enabling technologies uh such as ai robotics 3d printing et cetera and then also companies that benefit from this space so that make you know agriculture companies internet access gps construction imaging all that kind of stuff but really what we're interested here is that beta have highlighted here uh launching making servicing or operating platform platforms in the subordinate sub orbital space it's a tough word including drones air taxes and electric aviation vehicles eh certainly falls square within that and then otherwise we have lots of stuff here on risk and all the regulatory stuff they need to put in do read that stuff because risk is very important when you make investment decisions depository receipts i mentioned here adrs are specifically mentioned now it's a fairly standard clause of course but it is just interesting to see that they did mention adrs and and ehang of course is an adr uh they also mention here that international trading risk uh the funds may be um basically foreign ones and therefore the exposure is greater than etfs that do not invest in foreign securities so they're certainly including the possibility of buying foreign securities although again that is a pretty standard clause in one of these sort of pre-prospectuses and then there is lots of legal jargon which you might well wish to read if you certainly should read if you're interested to buy uh etf uh arc x so what's next we have an idea of when this is happening we have an idea of what they're going to do about investing they're certainly going to invest in drone companies now is kathy woods arc x the first etf that falls in this sector the first etf that is there no there are not there are some competitors and we're going to look at those and one of the indices that is tracked by etfs is the s network space index so i thought i'd show you that as well and we can see what they invest in communication services being the largest part of their industrials and then i t uh mostly u.s companies a little bit of france japan italy and israel now what companies are in there sorted by country here you can see a couple of french ones that's uh satellite companies airbus talus and um a couple of italians here one israeli satellite network and then mainly us companies and these are very much sort of space type companies you know satellite companies comcast lockheed martin boeing well at t northrop that sort of thing certainly not one chinese name in this index so let's have a look at the next one there is another one spdr snp kensho final frontiers etf exciting name a rather lengthy rokt is the ticker there so let's have a look at what do they invest in and that is a rather lengthy list i pulled up the spreadsheet here and again we can see a bunch of companies here some overlap there northrop honeywell lockheed martin virgin galactic for example boeing ttm you know a bunch of kind of satellite-ish companies i don't see anything chinese uh in in this so certainly not something that appears to be much covered therefore begs the question what is next is ea going to be one of them well i also thought well let's have a look at two eh's institutional shareholders of r and i couldn't find any well ubs was one in in july 2020 but in the last um filing of this um that that uh lovely form they have to thousands of nasdaq um i don't see it so they might have might have sold that off so we have got no institutional investors in ehang which is kind of interesting it goes to show just how we're kind of new and undeveloped that company is perceived to be now we do have an interesting bit of information from arc directly and again i'm going to show you the actual source here guys so this is arc invest website and they wrote an article in 2018 march almost three years ago i wanted that analyst and it's all about air taxis and it's got that lovely peter teal quote we wanted flying cars instead we got 140 characters i'm kind of with them on that one i'd much rather have flying cars and um it then goes through a couple of startups this is better mine guys this was 2018 and here says at least three startups uh volocopter ehang and kitty hawk and three established firms boeing abbas and uber are investing in the development of autonomous passenger drones essentially mini helicopters like the one pictured above yes and now we we see that the ehang one looks less like a helicopter more like a drone but it is a similar-ish design and they all have limited range electric vertical takeoff and landing drones and they can fly over traffic jams that seem to likely to proliferate as autonomous electric vehicles begin to dominate urban roads um and then it tells us the advantages of them you know they save uh safe regional give you basically a reasonable travel time at a reasonable price and they've done some research into air taxis basically taking the midtown manhattan to jfk airport uh journey and you can see here taxi cost 65 us dollars i actually thought it was a bit more than that but um perhaps that is right and then 17 minutes uh journey that time seems about right a helicopter is just under 200 takes five minutes um although that does discount the getting in and out of it and waiting for it and all that sort of stuff checking in so it's not really a fair comparison but yes air taxis 74 and 18 minutes moving a little bit more slowly and then subways 7.75 certainly the most cost effective option and at an hour uh a rather good competitor to the taxi perhaps somewhat less comfortable so that was kind of their thing there and then they're saying that you know batteries are going to get better and the range of air taxis will improve uh you know literally the same conversation we're having about evs all the time uh arc estimates that improved battery total technology will enable an air taxi to fly the 12 miles to manhattan to jfk by 2020 as the display shows below and i think there are rather accurate with that you can see when they expect that and that's i do think um the e-hang taxis could handle that uh although you are can only get two people in there without luggage i suppose it can carry about 200 kg maybe 160 kg in reality uh given what regulators require so it can't be you and lots of luggage and your whole family so that might be that's a little bit of a challenge you're going to need multiple taxes so that's kind of the the parallel they drew there and and you know they're giving us sort of an advantage in terms of of of uh why and then it is the display choice below that a tesla model s has an energy efficiency of 0.27 kilowatts per mile
and so the model s was the latest tesla at the time this is a bit of an old article uh and um the airtax is four times less efficient at 1.6 uh kilowatt hours per mile um and then they put the tesla semi truck in there which is six times less energy efficient so it's basically saying that you know it is a viable option but very interesting really that right at the top the three startups they mentioned are volocopter e hang and kitty hawk so certainly ihang is on their radar i mean that's what we can really take away from this as far back as 2018. now cassidy woods didn't write this article herself one of her analysts did this chap here sam chorus though you would think that they have some sort of policy on on on on which stocks they they cover and mention so what does this mean does this mean arc x is buying it well let's get to that in a second i think we should like what one more thing here really and that's is ehang really big enough to be included in such an etf and i mean big enough in terms of actual sales in projected sales if you look at this this is a a an investor presentation from ehang themselves from their website you can see the big drones that they have in queue through q3 rather they sold 23 now that's a lot better than in q3 2019 where they sold 18 of these large drones this eh 2716 that can carry passengers or about 160 kg of weight but it isn't that great a number is it really and how much do they therefore cost well they cost something like 200 to 300 000 us dollars a piece now much cheaper than a helicopter i grant you that but it's a lot more expensive than uh buying a car isn't it so they are still quite pricey and the volumes for the large drones i'm not talking about all the little sort of surveying drones and the little drones that can carry a small dha pass up to 5kg that sort of thing these kind of pilots they're running in in china but it isn't a lot of sales of these big drones so as of yet i think we should be realistic with this there isn't much of a market i mean i think you just have to be fair fair with that that okay they sold a couple in china uh because they're doing some tourism things you can fly over some beautiful sites in china with these uh and i think they have two of these fire fighting drones i don't know who bought them um perhaps they are i don't know i i just don't know they haven't announced who has bought them i think they are very clever and i think they will be in great demand eventually though at perhaps 300 000 us dollars plus a um fire station and you have a lot of fire stations that would need them and they would probably need more than one uh so that you could continuously fight a larger fire and a high rise the costs do rack up so i think i mean just being a little bit here um playing the counter argument that you have to be realistic where we are at the moment the technology is relatively expensive and the demand at the current price point for the large drones is relatively limited so let's have a quick look at what other companies are there out there who else is sort of competing for ark x's money now there are a bunch of them and i'm going to put them on a chart i'm going to show you the chart in just a second so there is aero environment that's the nasdaq avav i'm talking only here about properly listed ones not the otc or anything like anything privately held the money isn't going to go there so we don't need to look at that so that is a defense contractor and they make these unmanned drones basically um they also sell missile systems i understand and they get government contracts and they had a bit of a tough year about two years ago so but they are uh basically selling these drones to the military now there are other rather established companies that you could invest in if you were rx boeing being one of them they make a lot of airplanes and especially military aircraft uh and there is a huge huge drone market of course from the us military um so that's that's a a a one you could pour a lot of money into without moving the stock very much which is kind of appealing when you're in etf because if you just everything you buy just shoots up 40 percent halfway through you you're buying it then you obviously make it much more expensive for you to continue acquiring that stock ehang of course yes it is it is one uh you know there are um approved in china for commercial passenger use uh although we are only seeing sort of tourism kind of pilots at the moment nvidia is one i think that they might well look at because well they make a lot of parts that a lot of the top drones in the world use we see the same with the ev cars they know neo are mentioning them there that they're going to put them into that new et7 so i think they are one who was sort of indirectly benefiting from this and again a bigger stock again it wouldn't move as quickly now there are a couple of manufacturers also parrot for example this one now that's an otc stock so i wouldn't think that they would put money into that a gopro you could think of but they're having a bit of a tough time i sort of think they haven't really improved the usability and i think they haven't really solved the problem of what to do with all that footage uh because it's very well you bicycling around a mountain all day long and then you've got you know six hours of footage at massively high resolution well what do you do with it how do you share it what do you how do you edit this you know it's it's it's a little tedious so that's one i think amazon is also an interesting one because a they're a large tech company and they are you know quite leading in the drone sector and um they have a little fleet of drones and they um can deliver things to you and we are kind of like watching basically when that becomes properly legal i mean i know there is um there are some new rules and stuff out from the faa but it isn't sort of proper uh to use it yet northrop grumman grumman rather another massive defense contractor uh they also in noc on the stock exchange um they built the global hawk which is that u.s military and sort of surveillance drone uh that is flying around the world uh and that's a you know proper big drone stock uh lockheed martin there's another defense company they um are also building essentially military drones they are of course some other ones and um let's have a quick look i put some on a chart here guys so you can see a little bit of what's going on with them and the only one i didn't mention that just out of these i think is uavs here uh uh and that did i mention them uh and and also avav sort of canadian stocks that do mainly kind of there's a big agricultural use for drones and if i just um yeah you can see they've had a big announcement here uavs uh i think they were getting um oh sorry i think it's a a avav um apologist uavs they got those um was it one of the u.s states sort of agricultural heartland for kind of hemp growing and supervision
and production they got a sort of licensing deal there with the local regulator so you can see a lot of excitement in a lot of the drone stocks up here and then very little down there so for a moment the green one here that is eh i just faced out you can see that a pretty strong rally now the green horizontal line i've put in here that is the date the arc x fund was announced and yes you do see e8 shooting up from their 281 growth over three months to something like 375 growth over the three months and then it's gone up some more on the following day on the 14th and then it sort of come back down to earth slightly on the 15th so that stock is up 391 percent in three months i'm just gonna hide that one for a second and we look at uavs here also up similarly 381 now it didn't go up straight away on the 13th but sort of after after lunchtime or rather on the 14th really i think saying somebody woke up and uh also went and bought that so that also had a very very strong performance let me also hide that and then we can see what happened to the rest of them uh you can see avav here also very very strong rally on the 13th and everybody else well there's a little bit of a spike here in the noc stock a tiny spike in lmt um nobody else really and nvidia and video okay went up a little amazon touch but they've all kind of come back down so really i think the ones that have these big spikes uh av a v uavs and and e hang and let's put e hang back on here because that's kind of the one we are talking about so what does this all mean really well we don't know for sure that e hang will be included now if i were putting together a u.s etf i might be a little cautious on chinese stocks at present or they might think well it's it's going to be one of the biggest drain markets in the world and we're seeing china push drones very hard and here we have the ability to invest in that sector through just one company a relatively young relatively new but they are making decent drones and they are working with the chinese government which is always important to have that support here in china so you could look at the taikana from both ways i would say it's kind of 50 50 really um and if that's your view the 50 50 then well the stock is has jumped quite a lot from from where it was on that um day was announced to where it is now and it has come down a little bit but it has jumped quite a lot uh more than it has even in all the previous rallies uh really so from a price point point of view it ah it is it isn't cheap is it it's it's rather highly valued uh given uh the relatively small number of drones they're currently making now of course you can make a parallel there with tesla or any other kind of successful growth story and you can say well you know if you bought tesla at the very beginning it would have been all wonderful and and i i do see that point uh though they aren't the only kind of company that is making this space they are one of the sort of i wouldn't say big ones but they are one of the ones to watch but you do have to bear in mind you have competitors like you know boeing and the big u.s defense manufacturers who also know how to build drones uh and you know if you invest in those well you haven't got a pure drone exposure and i think that's really what what runs an eeh's e-hangs to each advantage much like we see with tesla and neo et cetera you know there is a limited number of stocks where you get really pure clean 100 evo in this case uh unmanned aerial vehicle exposure so i i do like the stock i think it is an interesting one and as always guys of course you know this is not financial advice this is just the ramblings of a madman um and i hope it entertains i would say it's about 50 50 whether he hangs in there and for me the the why why i'm leading in the middle there i think they must see that chinese risk this is a tech stock um will you know probably wouldn't be allowed to be sold in the us uh because of the um all the history we have or the data you know they don't want chinese drones flying over the us and i think they've only just realized that most of the drones in the u.s are chinese made
so i think that is a bit of an issue there now from a stock point of view if i mean a singular investor in ihang i don't have that as an issue because i just look at the chinese market and they're going to have a great domestic market and we're also seeing them doing tests in scandinavia and austria and spain and you know europe doesn't have quite the same uh sort of uh preach concepts and ex preconceptions or sort of issues with with chinese tech buying this now is definitely speculative that's what all i would say if you're buying it for arc x well then i i would say um probably buy a basket of all the things that could go in it and and and see how you do because some of these ones that have gone up like that well they might come crashing down to earth when they aren't included and and more likely in a way you would think that the major us and canadian perhaps companies would be included and ehang is is there perhaps a a smaller part of that and that's the other thing you wouldn't know what um percentage of our excess money will pour into it but you know what even if arc x doesn't invest in eh the fact that there is a sort of space drone etf is actually good for eh because it just gives the whole sector more exposure more people write about it more people talk about it and then people will also say well each is in it or not it will still get more attention and i think long term this is good for the whole drone sector which i think is why you saw a little bit of a spike here in quite a lot of drone companies so for me guys personally i think it's 50 50 or whether it's included and i don't normally like to sit on the fence i normally say one way or the other but i think the whole china issue is is an overhang and um but even if it doesn't i think it is still going to be good for ihang in the long run but the current chart is a little bit insane the speed at which that is jumping up and down based on very little sales and i know what some of you are saying well growth stocks are not about actual sales it's about future sales true but we still need regulation in place for the aviation authorities all around the world yes we are getting there in some places but it is still somewhat off and in china yes for small delivery drones we have a regulation now in place here which is wonderful but you are still yet to see a massive roll out i think you still need somewhat approval of local authorities so that's why we are seeing these tourism type things because if one of the drones comes down while it lands it lands in a lake or on a tree which is you know preferable than to to landing uh on a in the middle of a city so i think that's why we're really seeing that it is however a very very exciting sector i think actually it's more exciting than the ev sector because you know we all watch the jetsons i think and and don't you just want to fly out of your living room window uh and and go to work and and vice versa or if you want to go get a starbucks you could fly there it could actually it could come to you couldn't it on a drone a starbucks drone so i do think a lot of my stuff will be flying around overhead but we need to see data this is basically the equivalent of autonomous driving but harder because to collect the data you need to fly around and for that you need to get permission whereas at least the autonomous driving you can drive on around on a road and collect data that way so that's my take on this guys i think we are basically 50 50. um i'm going to keep covering some of these ev stocks because i think it's very exciting do you let me know what you think on this will you be buying into our arcs or not do you think it's over hyped already or do you think it's just the beginning of this massive growth spurt of the unmanned aerial vehicle space so guys as always i love you guys tuning in do share our videos hit that like and subscribe button and let's keep growing this community at the rate of 2x every 10 days which is incredibly exciting well not quite as good as ihang but you know still very exciting so guys that's that's a wrap here from hong kong and see you soon
2021-01-21 23:45
