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As investors react to escalating conflict between Iran and Israel, one unexpected defense stock stands out: Archer Aviation (ACHR).
Known primarily for its electric vertical takeoff and landing (eVTOL) technology, ACHR is now building momentum in the defense sector too.
At the time of writing, Archer Aviation stock is up some 80% versus its year-to-date low in April.
Archer Aviation Stock Could Benefit From Expansion into Defense
Archer’s growing footprint in military applications makes it a contender that stands to benefit in a conflict-driven macroeconomic environment.
The electric air taxi specialist built its flagship eVTOL aircraft (Midnight) primarily for urban air mobility, but its design is now proving adaptable for military use as well.
In late 2024, ACHR announced a strategic alliance with Anduril Industries to co-develop a next-generation hybrid eVTOL for U.S. defense needs. Under the new “Archer Defense” division – the NYSE-listed firm also raised $430 million at the time to support its pivot into defense.
Investors should note that ACHR’s earlier collaboration with the U.S. Air Force secured contracts worth up to $142 million and delivered the first Midnight aircraft to military evaluators.
Archer Aviation stock is currently down 28% versus its year-to-date high.
Macro Tailwinds Could Unlock Further Upside in ACHR Shares
Investors should consider loading up on ACHR shares because it now stands to benefit from macro tailwinds as well.
For example, a recent executive order from the White House aims at accelerating eVTOL adoption, which could lead to government-driven demand for Archer’s products over time.
Plus, the San Jose-headquartered firm was recently announced as the official provider of air taxi services for 2028 Olympics in Los Angeles.
That’s why analysts at HC Wainwright raised their price target on Archer Aviation stock last week to $18, which indicates potential upside of a whopping 80% from here.
What’s the Consensus Rating on Archer Aviation?
Other Wall Street analysts are keeping bullish on Archer Aviation shares as well.
The consensus rating on the eVTOL stock currently sits at “Moderate Buy” with the mean target of $12 indicating potential upside of some 20% from current levels.
