FAA milestone puts Archer Aviation’s certification path in focus
Archer Aviation (ACHR) has completed Phase 3 of 4 in the FAA Type Certification process for its Midnight eVTOL aircraft, a key regulatory step that investors will be watching closely.
See our latest analysis for Archer Aviation.
The recent Phase 3 certification milestone comes as the stock has a 30 day share price return of 16.52%, yet is still down 15.87% year to date. The 1 year total shareholder return has fallen 29.70%, while the 3 year total shareholder return is up strongly.
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With Archer trading at $6.84 and sitting at a reported 45% discount to the average analyst price target and a 63% implied discount to intrinsic value, you have to ask: is this a genuine opportunity, or is the market already pricing in future growth?
Most Popular Narrative: 65.9% Undervalued
At $6.84, the current price sits far below a narrative fair value of $20.04, which frames Archer as much more than a single-product air taxi bet.
Archer's recent Q1 2026 results and strategic moves fundamentally upgrade the investment thesis from a pure "air taxi operator" to a diversified aerospace platform.
• Beyond UAM (Defense & AI): Archer is no longer just a commercial eVTOL company. It is actively developing autonomous, hybrid military aircraft with Anduril and building AI-driven aviation software with Palantir and NVIDIA. This opens up new, potentially high-margin revenue streams well before widespread commercial air taxi adoption.
Curious how a hardware focused aerospace company, still reporting losses of $742.5m on $1.9m of revenue, can support that kind of valuation? According to Talos, it comes down to aggressive revenue expansion assumptions, stronger long term margins and a future earnings multiple more in line with premium growth stories than early stage industrials.
Result: Fair Value of $20.04 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, this hinges on timely FAA certification and successful commercialization. Archer is still reporting heavy losses and minimal revenue, so execution risk remains high.
Find out about the key risks to this Archer Aviation narrative.
Next Steps
With sentiment clearly split between risk and reward, it makes sense to move quickly, review the underlying data, and reach your own conclusion by weighing the 2 key rewards and 4 important warning signs
Looking for more investment ideas?
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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