Archer Aviation Stock (ACHR) Slips 14%, Yet Analyst Expects 30%+ Upside on eVTOL Plans
Archer Aviation (ACHR) stock took a sharp hit on Friday, with shares sliding 14% after the company announced an $850 million stock offering priced at $10 per share. The deal is expected to bring in $817.1 million in net proceeds and is set to close on June 16, 2025. While the fresh capital will help fuel Archer's growth and aircraft certification efforts, the share dilution clearly weighed on investor sentiment. In response to the funding news, Canaccord Genuity analyst Austin Moeller reaffirmed his Buy rating on Archer but trimmed the price target slightly from $13.50 to $13.00. The new price target implies over 30% upside potential.
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The announcement comes on the heels of new executive orders from President Donald Trump to implement an eVTOL (electric vertical takeoff and landing) Integration Pilot Program (eIPP) in the United States. This initiative aims to speed up the rollout of eVTOL aircraft in the U.S.
Analyst Backs Archer's eIPP Bid
Moeller called the $850 million raise an important move to help Archer take part in the eIPP. This new U.S. government program will support five electric aircraft projects, with the goal of getting them ready to operate before the 2028 Olympic Games in Los Angeles.
According to the analyst, Archer's quick action to raise funds shows its clear intent to take part in this eIPP initiative. He believes this extra capital will help the company speed up production and move through the aircraft certification process—both of which are crucial for meeting the program's tight timeline.
With this funding round, Archer's total cash balance is expected to rise to around $1.8 billion, based on its first-quarter 2025 figures and past fundraises. Notably, Archer ended the quarter with $1.03 billion in cash and equivalents. Moeller added that this figure does not include $47.5 million available through its at-the-market (ATM) program or up to $400 million in future support from Stellantis, which is expected to help expand production of the Midnight aircraft in Georgia.
Moeller believes Archer's strong financial base gives it a clear edge over its rivals. The Department of Transportation has 180 days to choose five aircraft designs for the eIPP, and Moeller sees Archer as a top contender. In his view, Archer stands out as one of the two leading eVTOL developers in the U.S.
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