Investing in Tomorrow: Archer Aviation’s Future Under New Leadership
A Look at Cathie Wood and Ark Invest’s Focus on Innovation
Cathie Wood leads Ark Invest, a firm recognized for its strong belief in cutting-edge technologies such as artificial intelligence (AI), genomics, and notably, the electric vehicle (EV) market. Ark’s most significant EV investment is in Tesla.
Apart from cars, Wood sees potential in the electric vertical take-off and landing (eVTOL) aircraft sector. Ark holds a stake in Archer Aviation (NYSE: ACHR), a leader in this emerging field.
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In 2024, Archer’s shares have increased by 82%, with the current share price at $11, nearing its three-year high. While many may think they’ve missed the opportunity, Archer has an intriguing prospect as it approaches 2025.
This article will discuss Archer’s recent partnership and why it could significantly benefit the company as President-elect Donald Trump takes office.
Archer’s Hidden Potential
Historically, Archer has been viewed as an airborne alternative to ride-hailing services like Uber and Lyft. Unlike premium services such as Blade Air Mobility, Archer aims to alleviate traffic congestion in urban areas, providing an alternative to taxis and subways.
In a recent video, Archer’s CEO, Adam Goldstein, highlighted a less-known opportunity within the public sector.
“We don’t need runways.” @ArcherAviation CEO @adamgoldstein13 discusses the future of commercial taxi aviation https://t.co/b15WPRp46y pic.twitter.com/znhk5azrrz
— Bloomberg TV (@BloombergTV) Dec. 13, 2024
How Archer Might Thrive Under Trump’s Leadership
Archer has partnered with Anduril, a company focused on advanced autonomous systems and founded by Palmer Luckey, known for selling Oculus to Meta Platforms. Anduril develops futuristic drones and rocket technologies, which complements Archer’s objectives.
Archer’s eVTOL craft are particularly suited for stealth operations due to their minimal noise, making them appealing for military use. The market for stealth and military robotic technologies is projected to exceed $100 billion by the early 2030s, indicating significant potential.
Goldstein expressed optimism that Trump’s administration could expedite regulatory approvals for Archer, helping them expand into public sector initiatives.
Image source: Getty Images.
Should You Consider Investing in Archer Stock?
In investing, discerning between a genuine business and an enticing story is challenging. Archer finds itself in a gray area.
Although the company presents exciting possibilities, it is currently in a pre-revenue stage. Despite securing billions in purchase orders, Archer has yet to achieve significant scale.
How Trump’s administration will impact regulatory frameworks and the speed of Archer’s commercialization remains unclear, and it might not be a top priority for the new leadership.
While Archer’s potential use in the public sector is compelling, it may take years for their aircraft to reach operational status.
I’m cautiously optimistic that Archer could become a success during the next four years. However, investing in Archer is likely best suited for those willing to take on speculative risks. If this risk is too high for your investment style, consider exploring more established options in the EV or defense sectors.
Is Now the Right Time to Invest $1,000 in Archer Aviation?
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Randi Zuckerberg, a former Facebook executive and sister of Meta Platforms CEO Mark Zuckerberg, serves on The Motley Fool’s board of directors. Adam Spatacco holds positions in Meta Platforms and Tesla. The Motley Fool has positions in and endorses Meta Platforms, Tesla, and Uber Technologies. For more details, see their disclosure policy.
The views expressed in this article are solely those of the author and do not necessarily represent those of Nasdaq, Inc.
