Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below.
Every great investor has a different favorite sector, but they have two things in common: excellent vision and timing. It’s not that they win every time, but more often than not their instincts are proven right in the long run. With that in mind, Cathie Wood’s recent purchase of five million shares of Archer Aviation shares takes on new meaning as the company has announced a reverse stock split.
Cathie Wood, the CEO of ARK Investhas always had a reputation for making aggressive transactions in the technology sector. So when she bought five million shares of vertical take-off and landing company Archer Aviation in late 2023, it seemed like business as usual. At the time, Archer’s stock was trading below $10 per share, creating a huge advantage for traders who had the resources to buy millions of shares at once.
Don’t miss:
Archer’s business model revolves around developing personal escape vehicles that serve as ‘air taxis“to get travelers from one place to another much more easily than cars. It’s a concept from The Jetsons or a 1960s television show that tries to imagine what transportation would be like in the 21st century. At the time the purchase of Wood, which over several months, several positive developments took place at Archer.
In December, Archer partnered with Anduril, a defense contractor that makes autonomous military applications and products. Archer combined that announcement with news that it had raised another $340 million in capital from United Airlines and Stellantis, both of which own shares in Archer. It seemed like it was all systems go for a big 2025, and then Archer announced a reverse stock split.
See also: cCommercial real estate has historically outperformed the stock market, and This platform allows individuals to invest in commercial real estate with as little as $5,000, offering a target return of 12% with a bonus 1% return increase today!
At a December 20 shareholder meeting, Archer shareholders approved a proposal to “increase the number of authorized shares of the Company’s Class A common stock available for issuance from 700,000,000 to 1,400,000,000.” The company also changed its articles of incorporation to limit ownership, control, or even investment in the company to U.S. citizens.