Archer Aviation’s (NYSE:ACHR) patent portfolio now includes more than 1,000 assets, a milestone reached following last week’s purchase of the patent portfolio from Lilium, the now-defunct German eVTOL company.
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Archer came out on top in a competitive bidding process for more than 300 patent assets covering a range of current and next-generation eVTOL technologies, paying roughly €18 million ($21 million).
Lilium’s patents cover crucial innovations that could speed up Archer’s development of future Midnight eVTOL models, such as advanced high-voltage systems, battery tech and management, next-gen aircraft designs, electric engines, flight controls, propellers, and ducted fans.
Canaccord analyst Austin Moeller thinks the company probably won the bid against Joby Aviation or Vertical Aerospace, believing it says something about the practicality of Lilium’s ideas. “We view this acquisition as a nod of approval from both Archer and the wider eVTOL industry that Lilium’s 50% silicon-dominant anode battery technology was likely more viable than its competitors previously made it out to be,” the analyst opined.
In fact, the battery design’s performance – featuring 50% higher energy density and a fivefold increase in power – was validated by the DoE’s Idaho National Laboratory in 2023. “We imagine that it is also possible for Lilium’s landmark ducted fan technology to be used in a future blended wing architecture for regional air mobility (RAM) missions,” Moeller further said.
The analyst thinks Archer will likely incorporate silicon-dominant anode lithium batteries in the next-generation Midnight, which could be adapted under a supplemental type certificate (STC) from the FAA to enhance the aircraft’s overall range and cargo (luggage/passenger) capacity. A longer range would also help alleviate concerns about reaching the 20-minute emergency battery reserve limit under visual flight rules (VFR) if air traffic control puts the aircraft in a holding pattern at an airport.
Moeller advises investors to watch for mentions of future Midnight eVTOL battery technology on upcoming earnings calls, as well as any updates on the hybrid-VTOL drone variant being developed for the DoW in collaboration with Anduril. The analyst also thinks it’s worth noting that the US Army announced at AUSA last week plans to launch its own Collaborative Combat Aircraft competition, which could potentially feature rotorcraft drones, considering the Army’s large Apache attack helicopter fleet. “Both of these opportunities represent strong positive catalysts for the stock,” Moeller said.
All told, Moeller maintained a Buy rating on the shares, along with a $13 price target, a figure that factors in 12-month returns of 12%. (To watch Moeller’s track record, click here)
Most analysts share Moeller’s enthusiasm. With an additional 5 Buys and 1 Hold, the analyst consensus rates the stock a Strong Buy. The average target is only slightly higher than Moeller’s objective; at $13.14, shares are anticipated to appreciate by 13% over the coming months. (See Archer Aviation stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.