Archer Aviation Profitability Analysis
| ACHR Stock | USD 6.04 0.26 4.50% |
Net Loss | First Reported 2010-12-31 | Previous Quarter -457.9 M | Current Value -435 M | Quarterly Volatility 180.8 M |
For Archer Aviation profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Archer Aviation to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Archer Aviation utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Archer Aviation's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Archer Aviation over time as well as its relative position and ranking within its peers.
Archer |
Is Aerospace & Defense space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Archer Aviation. If investors know Archer will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Archer Aviation listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Earnings Share (1.31) | Return On Assets (0.52) | Return On Equity (1.08) |
The market value of Archer Aviation is measured differently than its book value, which is the value of Archer that is recorded on the company's balance sheet. Investors also form their own opinion of Archer Aviation's value that differs from its market value or its book value, called intrinsic value, which is Archer Aviation's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Archer Aviation's market value can be influenced by many factors that don't directly affect Archer Aviation's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Archer Aviation's value and its price as these two are different measures arrived at by different means. Investors typically determine if Archer Aviation is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Archer Aviation's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.
Archer Aviation Return On Asset vs. Return On Equity Fundamental Analysis
Comparative valuation techniques use various fundamental indicators to help in determining Archer Aviation's current stock value. Our valuation model uses many indicators to compare Archer Aviation value to that of its competitors to determine the firm's financial worth. Archer Aviation is rated below average in return on equity category among its peers. It is rated below average in return on asset category among its peers . At this time, Archer Aviation's Return On Equity is relatively stable compared to the past year. Comparative valuation analysis is a catch-all technique that is used if you cannot value Archer Aviation by discounting back its dividends or cash flows. It compares the stock's price multiples to nearest competition to determine if the stock is relatively undervalued or overvalued.Archer Return On Asset vs. Return On Equity
Return on Equity or ROE tells company stockholders how effectually their money is being utilized or reinvested. It is a useful ratio when analyzing company profitability or the management effectiveness given the capital invested by the shareholders. ROE shows how efficiently a company utilizes investments to generate income.
Archer Aviation |
| = | -1.08 |
For most industries, Return on Equity between 10% and 30% are considered desirable to provide dividends to owners and have funds for the future growth of the company. Investors should be very careful using ROE as the only efficiency indicator because ROE can be high if a company is heavily leveraged.
Return on Asset or ROA shows how effective is the management of the company in generating income from utilizing all of the assets at their disposal. It is a useful ratio to evaluate the performance of different departments of a company as well as to understand management performance over time.
Archer Aviation |
| = | -0.52 |
Return on Asset measures overall efficiency of a company in generating profits from its total assets. It is expressed as the percentage of profits earned per dollar of Asset. A low ROA typically means that a company is asset-intensive and therefore will needs more money to continue generating revenue in the future.
Archer Return On Asset Comparison
Archer Aviation is currently under evaluation in return on asset category among its peers.
Archer Aviation Profitability Projections
The most important aspect of a successful company is its ability to generate a profit. For investors in Archer Aviation, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Archer Aviation will eventually generate negative long term returns. The profitability progress is the general direction of Archer Aviation's change in net profit over the period of time. It can combine multiple indicators of Archer Aviation, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
| Last Reported | Projected for Next Year | ||
| Operating Income | -444.8 M | -422.6 M | |
| Income Before Tax | -457.4 M | -434.5 M | |
| Total Other Income Expense Net | -12.6 M | -12 M | |
| Net Loss | -285.6 M | -271.3 M | |
| Net Loss | -457.9 M | -435 M | |
| Income Tax Expense | 500 K | 475 K | |
| Net Interest Income | 11.5 M | 12.1 M | |
| Net Loss | -444.2 M | -466.4 M | |
| Change To Netincome | 106.7 M | 91.2 M | |
| Net Loss | (1.69) | (1.78) | |
| Income Quality | 0.59 | 0.73 | |
| Net Income Per E B T | 1.15 | 1.11 |
Archer Profitability Driver Comparison
Profitability drivers are factors that can directly affect your investment outlook on Archer Aviation. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Archer Aviation position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Archer Aviation's important profitability drivers and their relationship over time.
Archer Aviation Profitability Trends
Archer Aviation profitability trend refers to the progression of profit or loss within a business. An upward trend means that Archer Aviation's profit has generally increased over time, and a downward profitability trend means profits are declining. Recognizing problems early in profitability trends allows investors to address revenue and cost issues in advance. Investors and analysts usually monitor three types of profitability trends: gross, operating, and net. Gross profit is the difference between revenue and costs of goods sold. Operating profit is Archer Aviation's gross profit minus its overhead. After you account for other unusual revenue, expenses, and costs, you get net profit. Gross profit trends are often a good indicator of future profitability. If you have high gross profit margins, you have a better chance to cover overhead and make money.
Archer Aviation Profitability Drivers Correlations
One of the toughest challenges investors face today is learning how to quickly synthesize and read into endless financial statements and information provided by the company, SEC reporting, and various external parties. Understanding the correlation between Archer Aviation different financial indicators related to revenue and profit generation helps investors identify and prioritize their investing strategies towards Archer Aviation in a much-optimized way. Analyzing correlations between profit drivers that are directly associated with dollar figures is the most effective way to break down Archer Aviation's future profitability.
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Use Archer Aviation in pair-trading
One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Archer Aviation position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Archer Aviation will appreciate offsetting losses from the drop in the long position's value.Archer Aviation Pair Trading
Archer Aviation Pair Trading Analysis
The ability to find closely correlated positions to Archer Aviation could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Archer Aviation when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Archer Aviation - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Archer Aviation to buy it.
The correlation of Archer Aviation is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Archer Aviation moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Archer Aviation moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Archer Aviation can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.Use Investing Themes to Complement your Archer Aviation position
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Additional Tools for Archer Stock Analysis
When running Archer Aviation's price analysis, check to measure Archer Aviation's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Archer Aviation is operating at the current time. Most of Archer Aviation's value examination focuses on studying past and present price action to predict the probability of Archer Aviation's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Archer Aviation's price. Additionally, you may evaluate how the addition of Archer Aviation to your portfolios can decrease your overall portfolio volatility.