Key Points
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Archer Aviation went public on Sept. 17, 2021, after a business combination with a SPAC.
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In 2021, Archer reported it had received a $1 billion purchase order from United Airlines.
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Massive disruptions to urban transportation don’t happen often. So when Archer Aviation (NYSE: ACHR) came along, heralding its plans to develop electric vertical takeoff and landing (eVTOL) aircraft that would revolutionize urban transport, growth investors sat up and took note. In the three months following its Sept. 17, 2021, initial public offering (IPO), Archer Aviation shares soared 111%.
But Archer Aviation’s recent performance tells a different story. Since the start of 2026, Archer Aviation’s stock has declined by more than 44%. Is this merely some market turbulence that belies a stronger performance since Archer’s IPO, or is it part of a longer downward trend?
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News of a $1 billion purchase order helped generate early investor enthusiasm
Following its founding in 2018, Archer debuted on public markets in 2021 after it completed a business merger with a special purpose acquisition company (SPAC).
In its S-1, Archer reported that it had received an order from United Airlines for the conditional purchase of up to $1 billion in aircraft, with an option to purchase an additional $500 million. The airline’s interest helped legitimize Archer’s ambitions to provide air taxi service. Between this and the company reporting success toward securing the requisite FAA certifications, shares soared 105% over the two years following the IPO.
Archer hasn’t ascended very high into the wild blue yonder
For those who bought Archer Aviation stock when the company went public, the returns have been disappointing. While the S&P 500 (SNPINDEX: ^GSPC) has soared 84% since Sept. 17, 2021, as of this writing, Archer Aviation has risen only 33.3%, meaning that those who bought $5,000 of Archer Aviation stock have seen their investments grow to $6,667.
Just because this eVTOL stock hasn’t produced market-beating returns doesn’t mean that it won’t in the future. It’s critical for potential investors to recognize, however, that the stock remains speculative, as Archer hasn’t commenced commercial operations. As a result, investors must have a high risk tolerance before clicking the buy button on Archer stock.
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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.
