Archer Aviation vs. GE Aerospace: Which Industrials Stock Is a Better Buy in 2026?

As the aviation industry balances between traditional power and electric innovation, investors face a stark choice. Deciding between Archer Aviation Inc (NYSE:ACHR) and GE Aerospace (NYSE:GE) requires choosing between future disruption and established dominance.

Archer Aviation is building a future of urban air mobility with electric vertical takeoff aircraft, while GE Aerospace is focused entirely on its aerospace engine business after the old General Electric split into three businesses, the other two being GE Vernova (NYSE:GEV) and GE Healthcare Technologies (NASDAQ:GEHC). This comparison explores which path offers the better risk-adjusted profile for your portfolio as the industry evolves.

The case for Archer Aviation

In its latest annual report, Archer noted it employed approximately 1,160 full-time workers at the end of 2025. The company primarily sells electric vertical takeoff and landing aircraft for urban markets, making a name for itself among defense stocks through its work with the U.S. Air Force. Its customer base includes United Airlines (NASDAQ:UAL), and it recently expanded its portfolio by acquiring subsidiaries from Boeing Co (NYSE:BA).

In FY 2025, revenue reached nearly $300,000. The company reported a net loss of approximately $618.2 million during this period. This reflects a significant increase in spending compared to the net loss of nearly $536.8 million reported in FY 2024.

As of its December 2025 balance sheet, the debt-to-equity ratio is roughly 0.1x, which compares total debt to shareholder equity. The current ratio, measuring the ability to cover short-term liabilities with short-term assets, is close to 19.9x. Free cash flow was negative at nearly $511.7 million, which is cash from operations minus capital expenditures.

The case for GE Aerospace

In its latest annual report, GE Aerospace noted it employs roughly 57,000 people. It specializes in jet and turboprop engines for commercial and military aviation. The company serves a broad global customer base, providing propulsion systems and integrated systems to major airframe manufacturers.

In FY 2025, revenue reached $42.3 billion, a growth of roughly 19% over the previous year. Net income for the fiscal year was close to $8.7 billion. This resulted in a net margin of approximately 20% for the period, which measures how much of each dollar of revenue remains as profit.

As of its December 2025 balance sheet, the debt-to-equity ratio is approximately 1.1x, meaning total debt is slightly higher than shareholder equity. The so-called current ratio is roughly 1.0x, indicating short-term assets just cover short-term liabilities. Free cash flow for FY 2025 reached nearly $7.3 billion.

Risk profile comparison

Archer Aviation faces intensive capital requirements to develop its aircraft and relies heavily on future financing. Regulatory hurdles remain a major obstacle, as the company needs several FAA certifications before commercial operations can begin. Additionally, it must successfully integrate assets acquired from Boeing while competing against established aerospace incumbents.

GE Aerospace recently navigated a $36 million administrative settlement regarding defense export controls, highlighting its regulatory exposure. The company also faces volatility in the aerospace market and the ongoing challenge of managing complex global supply chain disruptions. Additionally, it remains exposed to potential litigation and class action lawsuits related to its past securities practices.

Valuation comparison

Archer currently carries a high P/S ratio because it is still in its pre-revenue growth phase, and its Forward P/E is not yet meaningful based on future earnings estimates.

Valuation metrics sourced from Financial Modeling Prep (FMP) and may differ from other data providers.

Which stock would I buy in 2026?

One of these is a venerated U.S. maker of turbines and jet parts, while the other is a promising upstart that can offer growth stock potential.

The upstart, Archer Aviation, is taking concrete steps to make its business commercially viable. The federal government created the framework last year for real-world testing of eVTOL aircraft, a concrete step toward making Archer's vision a reality. Japan and South Korea, among others, are other countries building similar regulatory frameworks. A lot still has to happen for Archer's aircraft to get into the skies, but the notion that the nation's airspace is being regulated in a way that is holding back growth is one that has found favor.

Archer is refurbishing a small Los Angeles airport, named Hawthorne, for use as its testing grounds and is working to scale up its manufacturing capabilities to eventually reach capacity for 50 planes a year. Management has an initial plan to focus on military and cargo uses for its plane, which would be an easier path to early revenue. Future estimates are speculative, but Wall Street analysts see Archer turning its first profit in 2030, with $2.3 billion in revenue. But keep in mind, plenty of things have to go right between now and then.

GE Aerospace, meanwhile, is probably not the business you think it is. Most people think of it as a hardware business, supplying jet engines and parts, but that is just 30% of the business. The balance is service contracts on its 80,000 in-service engines with commercial companies and the U.S. military.

The company has $210 billion in backlog orders, $170 billion of which is in commercial services. It's massive. Management believes it can provide double-digit growth in the foreseeable future. For the current fiscal year, revenue is expected to rise 19% to more than $50 billion. That's not the growth of an old-line industrial. Net income will edge up at a lesser rate to $9 billion, but it's going in the right direction.

Archer may offer the tantalizing Jetsons-like future of small flying vehicles, but GE Aerospace is making money as an essential supplier to the entrenched aviation ecosystem. Buy GE Aerospace.

Brendan Coffey has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Boeing, GE Aerospace, GE HealthCare Technologies, and GE Vernova. The Motley Fool has a disclosure policy.