Archer Aviation (NYSE:ACHR), aside from a brief stumble over the past four trading sessions, has been one of the market’s biggest winners in recent times with the shares climbing 180% higher over the last three months.
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nvestors have been eyeing the company’s potential to become a major player in an industry that is poised to take off – literally. Archer is an eVTOL (electric vertical take-off and landing) aircraft manufacturer, essentially a maker of flying taxis in simplified terms.
Investors have been eyeing the company’s potential to become a major player in an industry that is poised to take off – literally. Archer is an eVTOL (electric vertical take-off and landing) aircraft manufacturer, essentially a maker of flying taxis in simplified terms.
While once just a fanciful idea, the notion of taxis littering city skies has become much more than a fantasy and could become a reality very soon. In fact, President-elect Trump has publicly voiced his backing for eVTOL aircraft, urging the FAA roll out urban air taxis faster than China, in order to strengthen the American industry for this new mode of transport.
Assessing Archer’s prospects, Canaccord analyst Austin Moeller, who ranks in the top 4% of Wall Street stock pros, thinks it stands to make the most of this opportunity.
“In our view, Archer Aviation is in a prime position to advance its aircraft certification process in 2025, buoyed by ‘animal spirits’ tailwinds for AAM (advanced air mobility) stocks due to the Trump administration’s supportive stance on the eVTOL sector,” said the 5-star analyst. “2025 offers multiple potential catalysts that we believe will ultimately drive positive investor sentiment in ACHR shares.”
These catalysts include significant progress in FAA certification, ongoing manned flight tests, and the introduction of favorable policies for the development of AAM networks in cities under the new administration. The company also aims to increase the build rate to two aircraft per month by the end of the year at their Georgia plant.
Despite a tough funding environment, Moeller thinks Archer’s record cash balance of ~$932 million leaves it well-positioned to advance production and certification progress, giving investors plenty of reasons to be optimistic about the Archer story.
But Archer’s opportunity stretches beyond that of just flying taxis. The company recently announced a significant partnership with defense tech firm Anduril, off the back of which the company created Archer Defense, an entity that will focus on developing an unmanned hybrid VTOL aircraft for military use.
“We believe that the VTOL drone market for Archer could eventually represent a significantly larger TAM than urban air mobility applications for Midnight, given the reduced complexity of OEM drone sales to DoD vs. certifying manned aircraft,” the analyst opined.
Moelle thinks all the above merits a positive reassessment of ACHR’s prospects. His price target for the stock goes from $11 to $14, suggesting shares will climb 70% higher in the months ahead. (To watch Moeller’s track record, click here)
That Wall Street likes this stock is clear from the Strong Buy consensus rating. That consensus is built on 6 recent Buy recommendations and 2 Holds. The shares are priced at $8.23 and their $11.38 average price implies ~38% upside from that level. (See ACHR stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
