Archer Aviation (ACHR) is the sexiest stock in the market right now!

With investors such as United Airlines, Stellantis, and Boeing, partners such as Southwest Airlines, and massive orders totaling over 6.2 billion dollars from the United States, United Arab Emirates, Japan, India, S. Korea, etc, Archer Aviation (ACHR) has quite the potential with ~2.5b market cap and a share price of $6. Below I will detail why I would recommend investing ASAP, as I’d argue that ACHR has the potential to end this year at anywhere from 3-4b, as there are catalysts on the horizon that I detail below.
Here’s my attempt at due diligence.
Ticker ACHR has shot up almost 100% in just two months, and many (myself included) would argue it’s just getting started and has a long way to go. Also for you Reddit apes, we have held between a 20-30% short interest for a long time now, so a short squeeze could happen in the near future. It’s also pretty rare to get a short squeeze on a company that it is worth holding.
I’m neither an airplane expert nor a financial advisor, but I do know a good amount about Archer Aviation having followed it closely since 2020, and am going to talk about why I personally have invested a significant chunk of my hard-earned finances into it. I also believe I’ll provide a unique angle as I’m going to focus a good amount on the people who work there (something others haven’t dove much into) who are much more intelligent than me or the average Reddit ape. Also, for credibility purposes, my last 3 investments have all gone up exponentially (IONQ, RKLB, ASTS). I was in these early and tried to get anyone and everyone to join in. Admittedly I also sold them early, so I won’t make the same mistake with ACHR. I’m not even thinking of selling until this stock hits at least a 10b valuation.
I’ve been meaning to write this for some time. Archer Aviation is a company that is near and dear to my heart. I began my investment in it when it was a SPAC in 2020, I believe I paid something like $12 a share. That was when I was brand new to investing aka gambling. It’s the only investment I made from back in my rookie days that I’ve not only held onto, but proudly DCA’d into. What attracted me initially is also what tends to attract me the most now: the team. Archer is essentially a startup, given that they used a SPAC to raise money to fund their ambitious company, versus growing with startup capital and IPO’ing in a traditional manner. The key indicator of a successful startup is the team, even more so than the product, as the team will ultimately build the initial product, and continue to develop it over time.
Archer was founded by co-CEO’s Adam Goldstein & Brett Adcock in 2018. They’re both entrepreneurs who had previously founded a company together called Vettery in 2013, which was a hiring marketplace for recruiting teams. They sold Vettery in 2018, and quickly incorporated Archer Aviation shortly thereafter in the same year. Why even mention Vettery? I believe it’s fundamental to their success, as they had expertise in hiring and recruiting ahead of starting Archer. Worth noting is that Brett Adcock left Archer to build Figure.
Figure, like Archer is incredibly ambitious as they are building humanoid robots similar to Elon’s Optimus line, and Brett is taking the exact same approach as Archer did by hiring the best talent right off the bat. Future CEOs take notice. Breaking the bank for the most qualified team is the only way to win in a hyper-competitive landscape where other companies have a head start. I remember when Brett was posting on LinkedIn before he started Figure and was asking people if they want to change the world with him, then just 2 years later he’s now raised 565M for Figure at a 2.6B valuation. Crazy to think that Figure already has a slightly higher market cap than Archer, but that will all change very soon. Brett seems to be the serial entrepreneur type, and I won’t be surprised if he becomes one of the more famous CEO’s of our generation. Adam’s also incredibly poised and stood out on the dais at the All In Podcast’s recent eVTOL panel discussion amongst the CEO’s of Joby and Wisk. Anyways, enough exposé on the founders, let’s dig into Archer Aviation.
Archer Aviation is an eVTOL company, which stands for electric vertical takeoff and landing. Vertical takeoff and landing equals helicopters. The unique thing about the eVTOL space is that they are being designed to take off as helicopters do by raising to the skies vertically, but the rotors will pivot mid-air and change direction, allowing the vehicles to propel forward as planes. Being electric offers numerous benefits as they are able to fly with less noise, less carbon impact, and be much more cost-effective in general. Since my first investment back in 2020, they’ve always stated that their goal was to begin commercialization in the year 2025, and everything is pointing to that now.
The eVTOL space itself has recently been legitimized as the FAA (Federal Aviation Administration) issued their final guidelines for eVTOLs in late October for eVTOLs to come to market, which means it’s now in the hands of the eVTOL companies to deliver the clear requirements issued by the FAA. Additionally, Donald Trump recently gave a speech a week or so ago that said eVTOL is one of his main priorities in upgrading America’s infrastructure. Between the FAA and our president, it appears that eVTOL’s are heating up in America. Additionally, EHang the premiere eVTOL company in China has put a lot of pressure on the world to catch up as they have ramped up operations much faster due to lesser restrictions from the government in China. EHang’s aircraft isn’t terribly impressive from a technology standpoint though, so I wouldn’t recommend their stock, and I think investing in China is particularly risky in general. These three tailwinds in this paragraph have combined to supercharge the eVTOL space as of late.
The most exciting use case and most ambitious one that eVTOL companies are aiming to solve is operating flying taxis, as the skies are clear and traffic on the ground today is dense and only getting worse. With 4 seats on each plane, the idea would be that you could fly from say the airport to a nearby destination in heavily trafficked cities such as New York or Los Angeles, while saving time and having competitive costs. Uber/Lyfts for one person from an airport with traffic can easily be $60-$100 depending on distance, and they are hoping for similar costs for flying taxis, though I’d imagine they’ll be pricier in the beginning stages. In the early going prior to flying taxi operations, I expect these vehicles to be used for medical emergencies, military, etc. Morgan Stanley estimates that the eVTOL market will be worth one trillion dollars in 2040. Yeah you read that right, $1,000,000,000,000 dollars. Now who stands to win this market?
Both Archer Aviation and Joby Aviation (JOBY) are the clear cut leaders in this space. Joby was started in 2009, and came to market the same way Archer did via a SPAC, only Joby entered with more funding and a higher valuation as they had 9 more years to develop their prototype than Archer did before raising. Anyone who has studied the space would tell you that it is Joby, Archer, then everyone else. As of market close on Friday, Joby has a 5.42b market cap, and Archer has a 2.57b market cap. The gap in market caps has made sense for a long time, as Joby has done a few things faster than Archer, such as getting Type 3 FAA certification and documenting piloted flights. They’ve also had more cash on hand, and have been long believed to be the #1 in the space.
Until Archer’s most recent earnings call, the market cap difference between Joby and Archer had been 3x, as Archer was around 1.4B and Joby was 4.2B or more for some time. What suddenly changed that has narrowed the gap to 2x instead of 3x? It would be Archer and Joby’s most recent earnings calls. According to analysts, Archer has distinguished themselves as being solely focused on bringing their eVTOL aircraft named Midnight into production. Joby on the other hand appears to be in a prototyping environment and focused on innovation vs. commercialization. Archer believes that their narrow focus will allow them to come to market faster.
Archer also has a much larger order book of just over 6.2 billion dollars worldwide (compared to their 2.5b market cap), having recently announced Japan’s largest airline Japan Airlines has made a $500M order on their most recent earnings call. Also worth noting, neither Archer or Joby have completed a production-scale manufacturing facility. Joby has invested $500 million to building one in Ohio that plans to scale to 500 aircrafts per year. Archer invested $65 million into theirs in Georgia, that plans to scale to 650 aircraft per year. Also, Archer’s facility is set to be completed by end of month November 2024, while Joby’s is aiming for 2025, but has no firm ETA in sight. This alone gives Archer a large advantage in my opinion to begin scaling up manufacturing of production-ready aircrafts. I’m going to stop here with the Joby/Archer comparison, as both are impressive companies. I ultimately believe ACHR is the better investment, as it has more room to grow given Joby’s current value, and with careful analysis you’ll find that these two companies are much closer than 2x apart.
Now I want to give more detail about why I first invested in Archer in 2020. As I mentioned above, it’s the team.
Co-CEO’s Adam and Brett came into the eVTOL space as non-technical founders. So they did the smartest thing possible, and hired the two smartest people in the room, Tom Muniz and Geoffrey Bower. Tom led the engineering efforts at Kitty Hawk, one of the earliest eVTOL companies that competed with Joby in the early 2010’s and Tom later was hired at Wisk (Boeing-owned eVTOL company and arguably third leader today behind Joby/Archer) to lead engineering efforts there. In other words, he’s one of the most important people in the entire industry. Wisk even sued Archer after they brought Tom on board, which means he was a great hire. Geoffrey was the Chief Engineer at Airbus, which is one of the largest aerospace companies in the world, and was working specifically on Airbus’ eVTOL efforts. You could say the exact same thing here about Geoffrey being one of the most important people in the entire eVTOL space.
Let me make this clear: you’d be insanely lucky to get one of these guys on your team. The two-headed dragon of Tom and Geoffrey is what has caused so many talented folks to join since. I’ve literally scoured the LinkedIn page’s of every single Archer employee hire, and I’ve read and believe that the reason that all of the brightest minds in the space want to be here is because of Tom/Geoffrey.
On the commercial side of things, they hired Nikhil Goel as Chief Commercial Offer, who led Uber Elevate (Uber’s eVTOL project) and Billy Nolen as Chief Regulatory Affairs Officer (formerly the acting administrator of the FAA). And just recently on their earnings call, they announced the hiring of Ken Pantalone, who worked at Lockheed Martin for 30 years and was the right-hand man to the creator of the original BlackHawk aircraft. Shortly thereafter, they announced the hiring of Dr. Talib Alhinai as their UAE (United Arab Emirates) Lead after his tenure with the Abu Dhabi Executive Office, who happens to be on the 30 under 30 Forbes list and an absolute power player in the UAE. The UAE also has the largest total order from ACHR with 2.3 billion dollars alone from their region. These are all incredible hires that most people who follow Archer have heard of. Let’s take a deeper dive into some people that you likely haven’t heard of.
Dr. Michael Schwekutsch is Archer’s SVP of Engineering and was VP of Engineering at Tesla, and then was Senior Director of Engineering at Apple in their Special Project Group.
Tom Anderson is Archer’s COO and was COO at Breeze Airways (new airline in the US), and Senior Vice President of Services at Airbus.
Dave Dennison is VP of Engineering at Archer and was at Bell Helicopter for 13 years, then VP of Engineering at Triumph Aerostructures for 4 years, and then led Hyundai’s eVTOL efforts for a short period before joining Archer.
Julien Montousse is VP of Design & Innovation, having led design at GM for 8 years and then Mazda for 12 years.
Isaac Harper is Sr. Director of Powertrain Manufacturing after leading Apple’s Special Project Group as an Engineering Manager for 7 years.
Heath Smoot is Sr. Director of Industrialization and Automation after working as a Sr. Manufacturing Engineer at both Tesla/Apple, then leading Joby’s Powertrain and Electronics Manufacturing.
Alan Tepe is Senior Manager of Propulsion Inverter Design after 8 years at Tesla being Manager of Mechanical Design Engineering for their Drive Inverter
Lina Spross is Head of Airworthiness at Archer after being Head of Production Certification, Quality & Supply Chain at Joby for over 4 years.
Bojan Zlicaric just joined a month ago, having been Director of Systems Engineering at BLUE ORIGIN, Jeff Bezo’s aerospace company, and the Senior Systems Engineering Manager at Boeing. He was at Boeing for 15 years and BLUE ORIGIN for almost 5.
All of the people listed above had long tenures in previous roles, and shifted gears to work at the much newer company Archer. I’d argue that the main reason so many talented people made that switch is because Adam & Brett started things off right by hiring Tom and Geoffrey to run engineering. Ambitious people want to work with the best talent. Damn near every Archer employee has an insane resume, but these are some of the key hires that are leading Archer today. Joby has a few impressive hires at the top, but there’s no comparison here, which is why I’m convinced that Archer has operated so effectively thus far.
Summary of investment thesis: Archer’s phenomenal team and laser focus on execution has caught them up to industry leader Joby rapidly. With many large catalysts on the horizon such as their Covington manufacturing facility, first piloted flight, and type 3 certification, there are many paths for this stock to shoot up in the near future. With an estimated TAM of $30 billion in 2030 and $1 trillion in 2040, this market has massive potential long-term. With a high volume of short interest in Archer, a short squeeze appears inevitable. I still think the biggest reason to invest is that Archer deserves to be closer to Joby, as many people are starting to realize that Archer might already be ahead. Conservatively I’d expect ACHR to hit $8-$9 per share by EOY, but if we get a short squeeze, piloted flight, and/or type 3 certification, this could be $12 or above. Get in now before it’s too late. Don’t say I didn’t warn ya ;).
Analyst Recommendations:
Cantor Fitzgerald (Buy) – In 2021 set a $14 price target, then revised to $10 in 2022.
Deutsche Bank (Buy) – Early 2022, set price target of $10, then raised to $12 later in 2022.
JPMorgan (Buy) – Early 2022, PT $7, and since has changed it to $6 and now at $5 as of latest revision in July 2024.
Raymand James (Buy) $8 PT set in 2022 and reiterated in 2023.
Barclays (Hold) $4.50 PT initiated a few days ago, increasing from initial PT of $3.50.
Canaccord Genuity (Buy) – PT of $9 set late 2023.
Benchmark (Buy) – $12 PT in 2024.
HC Wainwright (Buy) – September 2024 set $12.50 PT.
Needham (Buy) – Last week set $11.50 PT.
Bottom Line: Joby Aviation’s valuation alone suggests that Archer Aviation has more room to grow. Catalysts for this year suggest we can grow very soon. Also, the market is waking up to Archer, given that ACHR has been in the top 25 for daily volume in the entire market pretty consistently in the last few weeks.

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The Author
I wrote this blog for a few reasons. One is because nobody in my circle of friends ever puts me on to music or things that are dope that I haven't heard about (step your game up friends!) as few people nerd out as hard as me on the dumb things I focus on. The other and main reason is because I am so tired of The NeedleDrop and Pitchfork, from the way Fantano talks about music, to the way that Pitchfork writes about it. Both cause me physical pain to read or watch, yet I for some reason occasionally check their review scores, because they are the only sites I know that do stay on top of music (to a degree), and they focus on genres that I'm not tapped into, so occasionally I find something good. Is it worth the pain? No. So let me save you the pain, by only sharing with you my favorites, and maybe you'll find a new favorite. Oh and I also love talking shit, so I'll do that too, but this blog is about showing love to great art.
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