Stock Market

Cathie Wood Is Loading Up on Archer Aviation (ACHR) Stock

Source: T. Schneider /

One of Wall Street’s most prominent fund managers isn’t too concerned with Tesla (NASDAQ:TSLA) these days. In fact, Cathie Wood is turning her attention to a much smaller company in which she clearly sees significant potential. She recently trimmed her Tesla position and loaded up on Archer Aviation (NYSE:ACHR) stock, a startup making big moves in the electric vertical take-off and landing (eVTOL) space.

This comes after ACHR stock received a boost on news of an important new investment. But now Wood’s buy seems to be helping boost shares even more as the company’s winning streak continues into today.

Does this mean that Archer Aviation is a stock that investors should be watching as it continues its ascent into the green? Let’s take a closer look at this news and assess what its growth prospects look like.

What’s Happening With ACHR Stock

It’s been a good week for Archer so far. Yesterday, brought the news that Big Three automaker Stellantis (NYSE:STLA) is making another investment following the company’s successful test flight milestone last month. This $55 million cash influx helped boost ACHR stock, and so far, this winning streak hasn’t slowed down. As of this writing, shares are up 13% as the markets closed early, and the stock is quickly advancing out of penny stock territory.

Now Archer has a powerful new backer. Wood’s Ark Invest purchased 406,912 shares of ACHR stock, adding up to an investment of roughly $1.51 million based upon the previous $3.72 closing price. Now, shares are trading at $4.28 and look primed to pass the $5 mark soon. But Archer isn’t the fund’s only investment in the aviation space. Wood also recently purchased 3,788 shares of Blade Air Mobility (NASDAQ:BLDE), an air transportation company that has been making noticeable progress lately. The message is clear: she is betting big on the future of flying cars.

Other experts are also bullish on the fast-growing sector. InvestorPlace senior investment analyst Luke Lango discussed it last year, highlighting the growth potential that he sees for companies in the space:

“The way the industry is going to be set up is you’re going to create these vertiports in different areas,” he noted. “So in the residential neighborhoods and downtowns, near airports, near beaches, near popular tourist destinations, these vertiports that are essentially like landing pads for these eVTOL aircraft. And you’re going to hop in them, you’re going to drive to the vertiport with the parking lot, you’re going to park, you’re going to get out, you’re going to go into your eVTOL. It’s going to fly you to whatever vertiport you want to get to that’s going to be close to your final destination.”

Why It Matters

If Lango’s prediction proves correct, Archer will be in an excellent position to help usher in a new era of transportation. Through these recent investments, Wood has made it clear that she also sees high growth ahead for companies in this space, more so than she sees for Tesla. At its current price, ACHR stock still provides a tempting opportunity for investors looking to cash in on the flying car industry before it goes mainstream and everyone begins taking it seriously.

Wood has a reputation for successfully identifying beaten-down stocks, often in the tech space, and buying up shares before they rise again. She’s been correct before, and if she is this time, Archer is on the verge of reaching new heights.

On the date of publication, Samuel O’Brient did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.comPublishing Guidelines.

On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.

Samuel O’Brient is a Reporter for InvestorPlace, where his work focuses primarily on financial markets, global economic trends, and public policy. O’Brient writes a weekly column on recent political news that investors should be following.

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