Skyrocketing more than 228% in 2023, Archer Aviation (NYSE: ACHR) gave investors a lot to be happy about last year. In 2024? Not so much. Shares of the upstart air taxi stock have been in a nosedive for the better part of 2024, plummeting about 50% year to date.
But that’s not to say that there isn’t positive news regarding the company’s operations. In early September, Archer Aviation, a developer of electric vertical take-off and landing (eVTOL) aircraft, announced an auspicious development regarding its test flights — news that investors should certainly find encouraging with regard to the company’s growth prospects.
Testing, testing, 1, 2, 402!
In early September, Archer announced that it had completed 402 test flights so far in 2024 in pursuit of its type certification. That’s a surprising development, considering the company had targeted completing 400 test flights by the end of the year, so the company is well ahead of schedule. Speaking to the company’s achievement in accomplishing this feat, Adam Goldstein, Archer’s CEO and founder, said, “When we first set our goal for 400 flights this year it was viewed as aggressive, but here we are in August already knocking it out. I’m proud of the Archer flight test team and the supporting groups that made it happen.”
Successful completion of test flights is a critical step for Archer as it strives to to commence commercial operations. The company has already received other important Federal Aviation Administration certifications including Part 135 Air Carrier & Operator Certificate and Part 145, which allows it to perform specialized aircraft repair services.
And in other news…
Completion of the 402 test flights follows closely upon other encouraging announcements from the company. Last month, Archer revealed in its second-quarter 2024 financial report that it’s advancing plans to operate in the Los Angeles metropolitan area, where it plans on starting operations as soon as 2026. This includes providing air taxi services to customers at LAX airport, the University of Southern California, and Orange County — among other locations.
Earlier this year, Archer announced that it had signed a memorandum of agreement with Atlantic Aviation to provide air taxi services to several metropolitan areas: New York City, Los Angeles, northern California, and southern Florida. Partnering with Signature Aviation, Archer plans to operate in additional urban markets such as Chicago and San Francisco.
Besides the United States, Archer is targeting the launch of operations in foreign markets. In discussions with government officials, Archer hopes to begin operating in the United Arab Emirates as early as 2025. Partnering with InterGlobe Enterprises, Archer expects to deploy 200 of its Midnight eVTOL aircraft in India, where the companies plan — starting in 2026 — on offering air taxi services to customers as well as other services, including cargo, logistics, medical and emergency services, as well as private company and charter services.
Is now the time to land Archer stock in your portfolio?
While encouraging news may warm the hearts of investors who have already landed Archer stock in their portfolios, those on the sidelines shouldn’t feel a sense of urgency to click the buy button on an Archer investment. With the considerable sell-off in Archer stock this year, it seems the market is eager to see the company launch commercial services. In fact, smart investors know that rushing in to buy stock is rarely a smart move. Instead — as is the case with Archer — investors should thoroughly investigate the company, including a possible SWOT analysis, to see if an investment is right for them.
Fortunately for investors, even if Archer doesn’t seem like the right stock for them to take flight with, there are plenty of other compelling growth opportunities out there.
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Scott Levine has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
Archer Aviation Investors Just Got Some Bullish News was originally published by The Motley Fool
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