Cathie Wood Lands 3.4 Million Archer Aviation Shares Amidst Questions About Insider Information on Wall Street
In a strategic move, popular tech investor Cathie Wood has purchased a substantial number of shares in Archer Aviation, a leading player in the electric vertical take-off and landing (eVTOL) aircraft sector. This investment comes following a dip in Archer's share price, which can be attributed to the company's recent capital raise.
Archer Aviation is currently raising funds for the development of commercial capabilities, including infrastructure, to support its Launch Edition program, its planned U.S. commercial launch, and a strategic partnership as the official air taxi provider for the 2028 Olympics in LA. The company entered into a securities purchase agreement and issued 85 million shares at a fixed price of $10 to raise capital, a move that diluted existing shares and caused the stock price to drop significantly.
However, Wood's purchase indicates a strong belief in Archer's future growth potential. The funds raised will be used to develop commercial capabilities, prepare for the 2028 Olympics air taxi service in LA, and develop an AI-based aviation software platform in partnership with Palantir. These initiatives suggest substantial future growth potential for the company.
Archer has made significant progress with FAA certification and signed deals with companies in Abu Dhabi and Ethiopia, aiming for international expansion. A new multinational partnership led by the U.S. to streamline eVTOL certification further bodes well for Archer’s global ambitions.
The stock began selling off right out of the gate following the opening bell on June 13, with shares plummeting by 14%. Archer Aviation's stock is considered speculative to own at this point, as it has not yet begun manufacturing aircraft at scale and generating consistent revenue and profits across its various applications.
Despite the short-term volatility, Ark Invest, Wood's firm, has shown significant interest in Archer, reinforcing high conviction in the company's long-term prospects. Wood bought 3,433,807 shares of Archer Aviation across her exchange-traded funds (ETF) following the drop.
Recent administrative actions from the president could be a tailwind for Archer as it seeks FAA approval and makes good on its position to be a transportation provider during the 2028 Olympics. The drop in Archer Aviation's share price might not solely be due to Cathie Wood buying the dip, as there might be more factors at play. However, Wood's strategic move and the company's key projects and partnerships point towards a promising future for Archer Aviation in the emerging urban air mobility market.
[1] - Source: Yahoo Finance [2] - Source: The Fly [3] - Source: YCharts [4] - Source: BusinessWire [5] - Source: CNBC
- Cathie Wood's recent investment in Archer Aviation, a tech company focused on electric vertical take-off and landing aircraft, shows her confidence in the stock's future growth, despite a dip in share price resulting from a capital raise.
- The funds raised by Archer Aviation will be used for developing commercial capabilities, preparing for the 2028 Olympics air taxi service in LA, and developing AI-based aviation software, which could lead to substantial growth potential.
- Wood's firm, Ark Invest, has shown significant interest in Archer Aviation, buying shares following a drop in the stock price, indicating a belief in the company's long-term prospects, even amid short-term volatility in the finance and stock-market sectors.
