ACHR Outperforms Industry Over the Past Year: Should You Buy?

Archer Aviation Inc.’s ACHR shares have gained 44.7% in the past year, outperforming the Zacks Aerospace-Defense industry’s growth of 22.9% as well as the broader Zacks Aerospace sector’s gain of 20.6%. It also outperformed the S&P 500’s growth of 14.2% in the same time frame.

Similarly, a stellar performance can be seen in the share price return of other industry players like RTX Corporation RTX and Huntington Ingalls HII, which have witnessed a surge of 47.6% and 61.8%, respectively, in the past year.

With ACHR’s strong outperformance, some investors might be tempted to buy the stock immediately. However, it’s important to assess whether the company’s fundamentals can support sustained long-term growth or if the surge is only temporary. Evaluating ACHR’s growth prospects and potential risks is crucial for making an informed investment decision.

Tailwinds For ACHR

In November 2025, Archer Aviation signed an agreement to supply Anduril Industries and EDGE Group with its dual use electric powertrain technology to accelerate the development and scaled production of Anduril’s recently unveiled Omen Autonomous Air Vehicle system.

The company also signed a series of definitive agreements to acquire Hawthorne Airport in Los Angeles for $126 million in cash. The 80-acre airport, known as Jack Northrop Field, includes terminal, office and hangar facilities and is located less than three miles from LAX. This acquisition will support Archer Aviation’s planned LA air taxi network and serve as a key testbed for its AI-powered technologies.

In October 2025, Archer Aviation signed an agreement with Korean Air to launch its Midnight electric vertical take-off and landing (eVTOL) aircraft in Korea, starting with government use. Per the deal, Korean Air plans to buy up to 100 Midnight aircraft. This development is expected to support ACHR’s global expansion in the urban air mobility market.

The global eVTOL market is projected to grow steadily as demand for urban air mobility rises and advancements in sustainable transportation continue. This trend is creating new opportunities for companies actively investing in the sector. Archer Aviation is well-positioned to benefit from this long-term expansion opportunity as commercial operations scale up and regulatory support increases worldwide.

Such market growth trends bolster Archer Aviation’s prospects, especially once its Midnight jets become commercially available in the open market.

Earnings Estimates for ACHR

The Zacks Consensus Estimate for ACHR’s 2025 and 2026 losses indicates a year-over-year improvement.

The consensus estimates for its near-term earnings have made no movement over the past 60 days.

ACHR Shares Trading at a Discount

ACHR stock is trading at a discount, with its trailing 12-month Price/Book (P/B TTM) being 2.92X compared with its industry average of 6.29X.

Its industry peer, RTX and HII, are also trading at a discount. RTX is trading at a P/B TTM of 3.55X, while HII is trading at a P/B TTM of 2.44X.

Long-Run Prospects Seem Shaky

While ACHR has good short-term prospects, its long-term growth is still uncertain. The company is currently working to secure FAA certification for its Midnight aircraft so it can begin commercial flights soon.

However, ACHR also faces several challenges, including supply-chain problems, higher fuel-related costs and a shortage of skilled workers. Any delay in receiving FAA approval may force the company to raise more money and push back its revenue plans.

Since the eVTOL industry is still developing, ACHR’s future will depend on its ability to design, build and certify its aircraft, as well as on how quickly demand for eVTOL travel grows. If people remain concerned about safety, noise or cost, ACHR’s long-term growth may be limited.

What Should an Investor Do?

Investors interested in Archer Aviation may consider buying the stock now, as it continues to make steady progress through flight testing, strategic partnerships, acquisitions and global expansion efforts. While the company has not yet generated revenues, its developments point toward improving long-term prospects.

Those who already own this Zacks Rank #2 (Buy) stock may also continue holding it, supported by its strong performance over the past year and its relatively attractive valuation. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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