Archer Aviation Inc. (ACHR) saw its stock price tumble by 10.02% to close at $10.06 on December 30, 2024, amid heightened investor concerns over potential dilution and broader market apprehensions. The decline was primarily driven by the company's announcement to double its authorized Class A common stock from 700 million to 1.4 billion shares, a decision ratified in a special shareholder meeting on December 20. This move, coupled with the issuance of shares to Stellantis as part of a prior agreement, has raised fears of dilution among investors, contributing to the stock's downward pressure. Additionally, the insolvency filing of German eVTOL startup Volocopter has cast a shadow over the sector, further impacting Archer's stock as investors reassess the competitive landscape and financial stability of similar companies.
The stock opened at $10.62 and fluctuated between a high of $10.89 and a low of $9.82, with trading volume reaching 125% of its average, indicating significant investor activity. Despite the day's losses, Archer Aviation has seen a substantial rally of over 60% this year, but recent developments have prompted caution among investors. A prominent investor has advised waiting for a dip before further investment, citing potential risks such as FAA certification delays and manufacturing challenges.