June 14 Ark Invest’s Cathie Wood bought a large stake in Archer Aviation (NYSE:ACHR) after the stock slid nearly 15% Friday on a fresh equity sale.
According to recent news, Wood added about $40 million worth of ACHR shares across three of her exchange-traded funds. The Ark Innovation ETF (ARKK) led the move with over 2.8 million shares, while Ark Autonomous Technology & Robotics ETF (ARKQ) and Ark Space Exploration & Innovation ETF (ARKX) picked up smaller amounts.
The buying spree followed Archer’s announcement of an $850 million direct stock offering priced at $10 per share. Investors reacted to the dilution risk, sending shares lower.
Archer, which builds electric vertical takeoff and landing (eVTOL) aircraft, has laid out bold plans to launch air taxi services ahead of the 2028 Summer Olympics in Los Angeles.
Separately, Wood’s funds cut exposure to the defense sector, selling nearly $2 million worth of Kratos Defense & Security Solutions (NASDAQ:KTOS) stock.
The recent executive order from former President Donald Trump, aimed at fast-tracking eVTOL integration, could create tailwinds for companies like Archer.
Based on the one year price targets offered by 8 analysts, the average target price for Archer Aviation Inc is $12.31 with a high estimate of $18.00 and a low estimate of $4.50. The average target implies a upside of +23.25% from the current price of $9.99
This article first appeared on GuruFocus.