J.P. Morgan analyst Bill Peterson maintained a Hold rating on Archer Aviation (ACHR – Research Report) today and set a price target of $9.00.
Bill Peterson has given his Hold rating due to a combination of factors impacting Archer Aviation’s current and future prospects. One of the primary concerns is the uncertainty surrounding the timing of FAA certification, which is crucial for Archer’s commercial operations in the U.S. market. Despite efforts to expedite processes in other regions, such as the UAE, the lack of clarity on FAA acceptance of compliance verification documents suggests potential delays. Additionally, while the Launch Edition program may offer some financial relief by monetizing aircraft before full certification, the overall cash burn is expected to increase, particularly as the company invests in certification and manufacturing efforts.
Another factor influencing the Hold rating is the mixed financial performance, with Archer reporting an adjusted EBITDA loss that was slightly better than expected. However, the company’s future cash requirements remain a concern, as further capital will likely be needed to support ongoing operations and expansion plans. The anticipated contract manufacturing agreement with Stellantis and recent equity raises provide some financial cushion, but the need for additional funding persists. Furthermore, the potential market opportunity, while significant in the long term, is still contingent on overcoming current regulatory and operational hurdles. These elements combined lead to a cautious stance, maintaining a Neutral position with a price target of $9 by December 2025.