Sagittarius Aviation (NYSE: ACHR) Shares posted big gains in the last week of trading. The flying electric vehicle (EV) specialist’s share price ended the week’s trading up 10%, according to data from S&P Global Market Intelligence. Meanwhile, the S&P500 index ended the week with a loss of 2%, and the Nasdaq Composite The index ended the period with a loss of 2.3%.
Although the broader market saw a big sell-off after the Federal Reserve issued a more aggressive forecast for interest rates in 2025, Archer Aviation managed to close out last week’s trading on a high. The flying electric vehicle (EV) specialist posted big profits thanks to an announcement about its production prospects.
Like most of the stock market, Archer Aviation shares saw a big sell-off in conjunction with the Fed’s policy meeting on Wednesday. While the central bank authority announced the 25 basis point rate cut that the market expected, Chairman Jerome Powell issued new guidance for next year that roiled the market. Instead of repeating its previous forecast of four cuts of 25 basis points next year, the Fed now expects only two cuts of that size to occur. But Archer then delivered bullish news and was able to close the week’s trading in double digits.
After the market closed Thursday, Archer issued a press release announcing that it had completed construction and received the certificate of occupancy for its Georgia facility. The company said it expects to begin production of its Midnight Flying EVs in early 2025. By the end of next year, management expects the factory to produce two aircraft per month.
With last week’s gains, Archer Aviation stock is now up 54.5% in 2024 trading and has a market cap of about $4.1 billion. With the company still in a pre-earnings position, it’s fair to say that the company has a very growth-dependent and speculative valuation. The flying taxi specialist must also receive regulatory approval to commence commercial operations for its Midnight vehicles.
On the other hand, Archer says it already has $6 billion in orders for its Midnight flying taxis. With CEO Adam Goldstein recently stating that he expects to begin commercial flights next year, there appears to be a visible path to obtaining the necessary regulatory approvals. From then on, sales could increase rapidly.
In addition, Archer recently announced that it will enter the defense industry. The flying vehicle specialist is working with defense technology innovator Anduril to develop aircraft for military applications. With Midnight’s commercial debut potentially in sight and new growth opportunities in the defense sector, Archer Aviation stock could continue to see strong bullish momentum.
