This defense stock got rocked after earnings. How to bet on a rebound with options
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Business Insider
a day ago
- Business Insider
Can Archer Aviation (ACHR) Fly Higher? Why Our AI Analyst Is Staying Neutral
Archer Aviation (ACHR) is flying toward the future with big ambitions, but investors may want to fasten their seatbelts. Our AI Analyst currently gives the stock a Neutral rating with a score of 49, reflecting a mix of promising progress and financial growing pains typical of pre-revenue aerospace innovators. Don't Miss TipRanks' Half-Year Sale Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. Make smarter investment decisions with TipRanks' Smart Investor Picks, delivered to your inbox every week. The Upside: Partnerships and Progress Archer has taken bold steps toward commercial readiness. Test flights in Abu Dhabi demonstrate that its eVTOL aircraft can operate in extreme environments. At the same time, a $142 million contract with the U.S. Department of Defense highlights its strategic value beyond urban transport. It also boasts strong partnerships with Stellantis (STLA), Palantir (PLTR), and Anduril, positioning Archer to benefit from both aerospace and defense tech demand. The company's $1.03 billion cash cushion (as of Q1 2025), bolstered by an additional $300 million equity raise, is one of the largest in the space. That liquidity helps buffer the risks tied to high burn rates. With plans to launch the Midnight aircraft in the UAE this year and scale production to two units per month, Archer is preparing for liftoff, at least operationally. The Downside: No Revenue, High Risk Despite the innovation, Archer still reports $0 in revenue. Q1 2025 reported a $109 million adjusted EBITDA loss, driven by rising expenses, including headcount and R&D. The cash flow remains negative. Although the balance sheet is solid, the business model has yet to be proven. Investors should also weigh the dilution risk. The company's recent capital raise, although necessary, means more shares will be on the market. Regulatory hurdles, flight test delays, and the complexity of building a whole new transportation market also bring execution and adoption risks. From a trading lens, ACHR is hovering just above its 50-day moving average and comfortably above its 200-day mark, showing some positive trend momentum. MACD is flat but slightly positive, and the RSI is neutral at 49.1, indicating neither overbought nor oversold territory. In short, the chart reflects cautious optimism. The Verdict Archer Aviation is a compelling story, blending cutting-edge tech with high-stakes execution. But with no revenue and considerable uncertainty ahead, our AI Analyst is staying grounded for now. The Neutral rating reflects a balanced view, offering a significant opportunity, albeit with some turbulence. Investors eyeing ACHR should watch for FAA certification milestones, progress on commercial launches, and how well Archer manages cash in the months ahead. average ACHR stock price target is $11.75, implying a 15.54% upside.
Business Insider
3 days ago
- Business Insider
LMT, NOC, GD: Top Defense Stocks to Watch This Independence Day
On the dawn of American Independence Day, it is only fitting that investors consider researching the potential of the defense sector. Companies in this industry often attract attention due to their alignment with national security priorities and ongoing government spending. The defense sector has gained paramount importance in recent years, especially in light of the prolonged conflicts between nations. Don't Miss TipRanks' Half-Year Sale Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. Make smarter investment decisions with TipRanks' Smart Investor Picks, delivered to your inbox every week. During the recent NATO summit, members agreed to a new target of spending 5% of GDP on defense within the next decade, up from the previous 2% guideline. This increased budget is expected to benefit defense stocks, making them even more attractive to investors. It is evident that the U.S. plays a crucial role in today's war-torn world, and its defense companies garner significant attention for their advanced technology and strong performance. With this backdrop in mind, let's look at three American defense companies that have been major contributors to the U.S. defense sector and continue to demonstrate considerable strength. Lockheed Martin (LMT) Lockheed Martin is indeed one of the largest defense contractors globally. It serves as a major supplier to government agencies, including NASA. The company manufactures a wide array of products, such as missiles, targeting systems, military helicopters, and mission systems for various vehicles. The company's massive, long-term government contracts ensure a source of consistent and recurring revenue. For reference, LMT was recently awarded a $2.97 billion missile defense system contract over a 10-year indefinite-delivery/indefinite-quantity period. LMT also trades at a discount to the sector average, with its current P/E (price-earnings per share) ratio at 21.70x. Moreover, LMT offers an attractive dividend yield of 2.83%, paying a regular quarterly dividend of $3.3 per share. On TipRanks, the average Lockheed Martin price target of $527.15 implies a nearly 14% upside potential over the next 12 months. Also, seven analysts have given LMT stock a Buy rating, while six have rated it a Hold. Year-to-date, LMT stock has lost 3.5%. Northrop Grumman (NOC) Northrop Grumman is another promising aerospace and defense company, although it is smaller than Lockheed Martin. However, NOC has a different set of expertise, including autonomous systems, cybersecurity, strike platforms, logistics solutions, and C4ISR (Command, Control, Communications, Computers, Intelligence, Surveillance, and Reconnaissance). NOC is also one of NASA's key suppliers, specializing in satellite technologies and space systems. NOC currently trades at a relatively low P/E ratio of 16.53x, making it an attractive stock. Additionally, it offers an above-industry-average dividend yield of 1.83%, and pays a regular dividend of $2.31 per share. On TipRanks, the average Northrop Grumman price target of $541.36 implies 7.4% upside potential from current levels. 10 analysts have awarded NOC stock a Buy rating, while five have rated it a Hold. Year-to-date, NOC stock has gained 8.4%. General Dynamics (GD) General Dynamics also operates in the defense and aerospace sector, specializing in Gulfstream business jets, aircraft repair and maintenance, nuclear-powered submarines, commercial tankers and ships, main battle tanks, IT solutions, and intelligence and surveillance systems. On July 2, General Dynamics Electric Boat was awarded a $1.85 billion contract modification to a previously awarded contract supporting submarine production. Moreover, it received a $150 million Army contract, and the GD Information Technology segment was awarded a $580 million contract to sustain force protection systems such as radars, cameras, and sensors worldwide. Additionally, GD pays a regular quarterly dividend of $1.5 per share, carrying an attractive dividend yield of 2.04%. Its P/E ratio stands at 19.33x. On TipRanks, the average General Dynamics price target of $296.38 implies that shares are almost fully valued at current levels. Meanwhile, GD stock has gained 13.1% year-to-date. Also, six analysts each have given GD stock Buy and Hold ratings. Which Is the Best Defense Stock? Among the three stocks discussed above, Lockheed Martin appears to be the most favorably positioned, thanks to its well-diversified revenue stream, long-term government partnerships, healthy dividend yield, and reasonable valuation.
Yahoo
3 days ago
- Yahoo
Traders Pile on Short Positions as Bitcoin Approaches All-Time High
Crypto traders are exhibiting bearish behavior despite bitcoin BTC trading above $110,000 and possibly taking aim at a new record high above $112,000. Data from Coinalyze shows that during bitcoin's move this week from $106,000 to $110,000, the long/short ratio fell from 1.223 in favor of longs to 0.858 in favor of shorts. It's worth noting that the long/short ratio in this case is analyzing the percentage of accounts that are long or short, which is typically an indicator of retail sentiment. The long/short ratio has been negative numerous times during the recent move above $100,000 despite staying positive throughout the previous bull market in 2021. Open interest also rose from $32 billion to $35 billion during this period, indicating that significant capital is being pumped into shorting bitcoin. However, funding rates remained positive throughout this rise, indicating that traders are also entering long positions. Bitcoin has been trapped in a relatively tight range since early May, trading between $100,000 and $110,000 with three tests of each level of support and resistance. Technical indicators like relative strength index (RSI) continue to paint a bearish image with several drives of bearish divergence, with RSI weakening on each test of $110,000. The recent influx of short positions could well be lower timeframe traders capitalizing on the range, shorting resistance before reversing their trade at each test of $100,000. This rang true on June 22 when the long/short ratio shot up to 1.68 as bitcoin momentarily slumped through $100,000 before bouncing. There is a potential bull case with the increase in short positions: a short squeeze. This would occur if bitcoin begins to trigger liquidation points and stop losses above a record high, which would cause an impulse in buy pressure and continuation to the in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
