The second half of 2025 offers a chance for investors to shake off the cobwebs of tariffs and recession fears and focus on where the market is going, rather than where it has been. Archer Aviation (ACHR +1.50%) has been on a roller coaster, while Cognex (CGNX 0.80%) and First Solar (FSLR +3.15%) have sold off considerably year to date.
Despite these jarring moves, these three companies could be worth buying in the second half of 2025 and holding for years to come. Read on to find out why.
Image source: Getty Images.
Archer Aviation stock has soared since this time last year -- and it's poised to keep ascending.
Scott Levine (Archer Aviation): If you take a look at Archer Aviation stock's performance in 2025, you'll see it has logged a modest 3% gain (as of June 20). If you expand your perspective to the past year, however, you'll find a much different story -- a 222% gain.
NYSE: ACHR
Key Data Points
In light of this, growth investors may feel like it's too late to hitch a ride with the electric vertical takeoff and landing (eVTOL) stock, but there's no reason to think that Archer can't gain considerably more altitude.
Developing innovative aircraft -- such as Archer's eVTOL aircraft dubbed Midnight -- is no small feat. To ensure that the aircraft is safe, Archer is undergoing a rigorous certification process from the Federal Aviation Administration (FAA) that's nearing its conclusion.
The company has received a variety of requisite certifications from the FAA and is currently working toward receiving Part 142, the final certificate it needs before commencing commercial operations. Management is optimistic about receiving the certification soon and projects it will start commercial operations in 2025.
Separate from the FAA certification, Archer continues to make progress in securing partnerships. Most recently, it announced an agreement (valued at up to $18 million) to deploy its Midnight aircraft in Indonesia, which is the third agreement of its type. Archer has also inked agreements in the United Arab Emirates and Ethiopia.
According to Business Research Insights, the eVTOL market is poised for significant growth. Whereas it was valued at about $1.2 billion in 2024, it's expected to climb to $20.1 billion by 2033.
For those scanning the skies for a growth stock with tremendous upside, Archer hits the mark.
Machine vision is the future of automated manufacturing
Lee Samaha (Cognex): If you looked at a three-year chart of revenue growth -- or rather decline, in this case, as Cognex's revenue is down 15.3% over the period on a 12-month rolling basis -- the last thing you'd conclude is that it's a "monster growth" stock. That said, the chart below provides a broader perspective.
CGNX Revenue (TTM) data by YCharts.
Unfortunately, the last few years have been challenging, with high interest rates pressuring end demand in two key markets -- automotive and consumer electronics. Meanwhile, the company's logistics end market (primarily e-commerce warehousing) experienced a boom during the lockdowns, only to face a correction in the following years.
Still, Cognex's long-term growth trend remains impressive, and management highlighted the opportunity ahead during its recent investor day event. In a nutshell, management expects a combination of underlying industry growth of 4%, with 6% to 7% growth on top of that from the increasing penetration of machine vision into automated processes. Throw in 3% growth from inorganic sources (Cognex is the industry leader, so acquisitions are likely), and it results in long-term growth of 13% to 14% per annum.
Those assumptions appear reasonable, considering the ever-increasing complexity of production, the need to improve manufacturing efficiency and quality control, the desire to reshore production to higher-labor-cost countries, and the increased value added to its solutions through artificial intelligence. It adds up to a compelling growth story -- if you can tolerate some possible volatility, given challenging near-term end markets.
A bright light in a cloudy industry
Daniel Foelber (First Solar): Solar stocks soared in 2020 due to a combination of low interest rates, favorable policies, government support, and a push for clean energy. Since then, however, many solar stocks have gotten crushed as these same factors that drove the industry higher have reversed course.
Borrowing costs now are elevated. And last week, the Senate Finance Committee proposed accelerating the reduction and removal of tax credits for solar and wind energy.
Solar-panel manufacturer First Solar plunged on the news in lockstep with the broader industry. But even when factoring in the sell-off, First Solar has been a standout and is actually outperforming the S&P 500 over the last five years. In contrast, the solar industry, as measured by the Invesco Solar ETF, is down over that period.
There are several reasons why First Solar has held its own despite immense industry pressure. For starters, it's profitable and has an impeccable balance sheet. It also doesn't manufacture in China -- an advantage if trade tensions mount.
The company has been expanding its U.S. footprint recently, including opening a $1.1 billion manufacturing facility in Alabama last year. These moves could pay off over the long run if government incentives and trade policy continue to favor companies that onshore their manufacturing and create U.S. jobs.
Despite these advantages, First Solar still relies on government subsidies and sustained commercial investment in solar. In its Q1 2025 earnings release, First Solar guided for $1.45 billion to $2 billion in operating income. But that figure assumes $1.65 billion to $1.7 billion in 45X tax credits.
The 45X tax credit incentivizes domestic production and sale of renewable energy components (like solar panels). Take away the tax credits, and First Solar's profitability and high cash flow are put in jeopardy.
Given the industrywide uncertainty, it's understandable investors may be on the sidelines with First Solar stock. But the company has what it takes to ride out the industrywide downturn.
Despite profitability pressures, First Solar still expects to finish 2025 with $400 million to $900 million in net cash (cash, cash equivalents, restricted cash, restricted cash equivalents, and marketable securities, less expected debt). The company also has a massive order backlog that supports years of future cash flow (although that backlog could decrease if customers pull back on purchases).
Add it all up, and First Solar stands out as one of the best all-around buys in the industry for patient investors.
