Archer Aviation Has Fallen Over 20% and Looks Like a Long-Term Buying Opportunity

Archer Aviation (NYSE: ACHR) stock is down over 20% in 2026 and trades roughly 56% below its 52-week high of $14.60. Those glaring red numbers, however, don't tell you the full story. Indeed, the irony in Archer's recent decline is that, even while it trades in the red, its business has never looked stronger.

Archer is becoming a stronger company

At its core, Archer Aviation is developing an electric vertical takeoff and landing (eVTOL) aircraft called Midnight.

This small electric aircraft is being designed to lift straight off a rooftop and fly you to your destination in about 10 to 15 minutes. If Archer can get Midnight through the FAA's regulatory process, which it has been progressing through steadily, commercialization of this air taxi could unlock untold billions in revenue.

Image source: Archer Aviation.

That's been Archer's primary story. But recently, it's added another node to its growth thesis: defense.

In one sense, Archer has always had defense in mind. It partnered with defense technology company Anduril in 2024, and it has worked with the Department of Defense through the Air Force's AFWERX program since 2021. But that side of its business has perhaps never looked more substantial than it does today.

In July 2026, Archer and Anduril unveiled a jointly developed autonomous platform for defense and commercial applications. Anduril revealed its defense variant, Thunder, while Archer revealed a commercial variant, Halo.

These aircraft use a hybrid-electric powertrain, so they're not, strictly speaking, eVTOLs. That's not a bad thing: The hybrid design gives them a greater range than an aircraft that runs on battery power, like Midnight. This, in turn, could open the door to businesses whose purposes for aircraft would be utterly impractical for an urban air taxi.

Then, in August, Archer made another announcement: It agreed to acquire three businesses from Boeing -- Wisk Aero, Insitu, and SkyGrid -- largely in exchange for newly minted Archer stock and warrants. One of these businesses, Insitu, is a profitable defense company that has generated over $200 million in annual revenue. Compare that to Archer's revenue last quarter ($5 million), and you can see how this acquisition could give Archer something it badly needs.

Why I think the sell-off creates an opportunity for long-term investors

First off, don't get the wrong impression. These developments in Archer's defense business, while strengthening the company overall, don't change what Archer needs most to grow in the long term: an FAA-certified Midnight.

More than that, it needs hundreds of these bad boys operating in U.S. cities and around the world. That's the vision Archer sold to early investors, and that's the reality Archer needs to realize if it wants to grow significantly.

At the same time, Archer is trading at half its former 52-week high while also looking a little less speculative. The company still needs to work on its fundamentals and obtain FAA type certification for its eVTOL Midnight.

But today's price gives investors a better risk-reward setup than they had when Archer stock was at near highs. There's still plenty of risk, but for investors willing to stomach the volatility, I think Archer's beaten-down price offers a compelling long-term opportunity.

Steven Porrello has positions in Archer Aviation. The Motley Fool has positions in and recommends Boeing. The Motley Fool has a disclosure policy.