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Archer Aviation (NYSE:ACHR) stock is rocketing about 17% higher today. The rebound comes after the company, which makes electric vertical takeoff and landing (eVTOL) aircraft, disclosed new deals with the U.S. Air Force.
The contracts could have a total value of as much as $142 million.
ACHR Stock: More About the Agreements
Under the deals, Archer will provide the Department of Defense (DOD) with as many as six of its aircraft. ACHR will also furnish the Air Force with “additional flight test data and certification related test reports, (and) pilot training.” Finally, the company will help the Pentagon launch maintenance and repair operations for the eVTOLs.
Archer had been consulting with the Defense Department for two years in an effort to help the military adapt “eVTOL technologies (to) DoD purposes,” the company noted.
According to the company, the Pentagon may choose to undertake further initiatives in partnership with the eVTOL maker, raising the revenue that ACHR will receive from the agency.
An Upbeat View of eVTOLs
In a note to investors on June 29, investment bank Canaccord Genuity wrote that many could be underestimating the potential of the eVTOL market.
According to the bank, the aircraft’s share of total paid rides to airports could reach about 15%, while “5% of longer-distance regional trips could be replaced by eVTOL aircraft.” The firm added that the total available market for the sector could come in at nearly $58 billion by 2033.
The shares have soared 200% this year, 97% in the last six months, and 38% in the last month.
On the date of publication, Larry Ramer did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.