Embraer S.A. [ERJ] Revenue clocked in at $2.58 billion, up 13.22% YTD: What’s Next?

Embraer S.A. [NYSE: ERJ] gained 10.30% or 0.72 points to close at $7.71 with a heavy trading volume of 5898380 shares. The company report on January 13, 2021 that EMBRAER S.A.: Congo Airways Orders Two E195-E2.

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Just six months after their first E2 order, Congo Airways has placed a firm order for two E195-E2 jets. This is in addition to their existing two aircraft order for the smaller E190-E2. The four aircraft deal has a total value of USD 272 million at current list prices. This new firm order will be included in Embraer’s 2020 fourth quarter backlog.

Desire Bantu, CEO of Congo Airways said, “We see an opportunity in our market and the crisis we are all facing for Congo Airways to emerge stronger – which is why we are not waiting to place this further order. These new jets will allow us to extend our passenger and cargo operations regionally to high demand destinations such as Cape Town, Johannesburg, and Abidjan. As we prepare for future success, we will have the flexibility, and the right sized, most efficient aircraft, to serve our customers as the market returns.”.

It opened the trading session at $7.16, the shares rose to $7.79 and dropped to $7.145, the range by which the price of stock traded the whole day. The daily chart for ERJ points out that the company has recorded 24.76% gains over the past six months. However, it is still -94.7% lower than its most recent low trading price.

If we look at the average trading volume of 2.72M shares, ERJ reached to a volume of 5898380 in the most recent trading day, which is why market watchdogs consider the stock to be active.

Here is what top equities market gurus are saying about Embraer S.A. [ERJ]:

Based on careful and fact-backed analyses by Wall Street experts, the current consensus on the target price for ERJ shares is $6.41 per share. Analysis on target price and performance of stocks is usually carefully studied by market experts, and the current Wall Street consensus on ERJ stock is a recommendation set at 3.10. This rating represents a strong Buy recommendation, on the scale from 1 to 5, where 5 would mean strong sell, 4 represents Sell, 3 is Hold, and 2 indicates Buy.

Morgan Stanley have made an estimate for Embraer S.A. shares, keeping their opinion on the stock as Underweight, with their previous recommendation back on August 11, 2020. The new note on the price target was released on May 04, 2020, representing the official price target for Embraer S.A. stock.

The Average True Range (ATR) for Embraer S.A. is set at 0.37, with the Price to Sales ratio for ERJ stock in the period of the last 12 months amounting to 0.55. The Price to Book ratio for the last quarter was 0.49, with the Price to Cash per share for the same quarter was set at 12.29.

Trading performance analysis for ERJ stock

Embraer S.A. [ERJ] gain into the green zone at the end of the last week, gaining into a positive trend and gaining by 16.47. With this latest performance, ERJ shares gained by 8.13% in over the last four-week period, additionally plugging by 24.76% over the last 6 months – not to mention a drop of -59.68% in the past year of trading.

Overbought and oversold stocks can be easily traced with the Relative Strength Index (RSI), where an RSI result of over 70 would be overbought, and any rate below 30 would indicate oversold conditions. An RSI rate of 50 would represent a neutral market momentum. The current RSI for ERJ stock in for the last two-week period is set at 66.38, with the RSI for the last a single of trading hit 70.98, and the three-weeks RSI is set at 64.11 for Embraer S.A. [ERJ]. The present Moving Average for the last 50 days of trading for this stock 6.37, while it was recorded at 6.92 for the last single week of trading, and 5.84 for the last 200 days.

Embraer S.A. [ERJ]: A deeper dive into fundamental analysis

Operating Margin for any stock indicates how profitable investing would be, and Embraer S.A. [ERJ] shares currently have an operating margin of -4.31 and a Gross Margin at +13.67. Embraer S.A.’s Net Margin is presently recorded at -8.31.

Return on Total Capital for ERJ is now -2.04, given the latest momentum, and Return on Invested Capital for the company is -4.07. Return on Equity for this stock declined to -6.03, with Return on Assets sitting at -2.02. When it comes to the capital structure of this company, Embraer S.A. [ERJ] has a Total Debt to Total Equity ratio set at 3.71. Additionally, ERJ Total Debt to Total Capital is recorded at 3.58, with Total Debt to Total Assets ending up at 1.22. Long-Term Debt to Equity for the company is recorded at 3.14, with the Long-Term Debt to Total Capital now at 3.03.

Reflecting on the efficiency of the workforce at the company, Embraer S.A. [ERJ] managed to generate an average of -$46,459 per employee. Receivables Turnover for the company is 2.86 with a Total Asset Turnover recorded at a value of 0.24.Embraer S.A.’s liquidity data is similarly interesting compelling, with a Quick Ratio of 1.10 and a Current Ratio set at 2.30.

Embraer S.A. [ERJ]: An earnings per share (EPS) analysis

With the latest financial reports released by the company, Embraer S.A. posted -0.51/share EPS, while the average EPS was predicted by analysts to be reported at -0.12/share. When compared, the two values demonstrate that the company fail the estimates by a Surprise Factor of -325.00%. The progress of the company may be observed through the prism of EPS growth rate, while Wall Street analysts are focusing on predicting the 5-year EPS growth rate for ERJ. When it comes to the mentioned value, analysts are expecting to see the 5-year EPS growth rate for Embraer S.A. go to 4.08%.

An analysis of insider ownership at Embraer S.A. [ERJ]

There are presently around $478 million, or 35.00% of ERJ stock, in the hands of institutional investors. The top three institutional holders of ERJ stocks are: BRANDES INVESTMENT PARTNERS, LP with ownership of 24,259,929, which is approximately -5.257% of the company’s market cap and around 12.40% of the total institutional ownership; HOTCHKIS & WILEY CAPITAL MANAGEMENT LLC, holding 5,266,440 shares of the stock with an approximate value of $40.6 million in ERJ stocks shares; and OLDFIELD PARTNERS LLP, currently with $32.94 million in ERJ stock with ownership of nearly -19.547% of the company’s market capitalization.

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Positions in Embraer S.A. stocks held by institutional investors increased at the end of March and at the time of the March reporting period, where 43 institutional holders increased their position in Embraer S.A. [NYSE:ERJ] by around 4,576,848 shares. Additionally, 76 investors decreased positions by around 12,648,944 shares, while 19 investors held positions by with 44,723,822 shares. The mentioned changes placed institutional holdings at 61,949,614 shares, according to the latest SEC report filing. ERJ stock had 9 new institutional investments in for a total of 207,760 shares, while 27 institutional investors sold positions of 5,279,738 shares during the same period.

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