why Embraer S.A. [ERJ] is a Good Choice for Investors After New Price Target of $22.25


Embraer S.A. [NYSE: ERJ] plunged by -$0.47 during the normal trading session on Wednesday and reaching a high of $15.53 during the day while it closed the day at $15.16. The company report on November 16, 2021 that Viasat, Embraer Enter into Line-fit Agreement to Offer Viasat In-Flight Connectivity on Embraer E2 Aircraft.

Viasat Inc. (NASDAQ: VSAT), a global communications company, and Embraer (NYSE: ERJ; B3: BOVESPA: EMBR3), a global aerospace company, announced they entered into a Buyer-Furnished Equipment (BFE) agreement to offer Viasat’s advanced In-Flight Connectivity (IFC) system as a line-fit option on Embraer’s family of E2 aircraft. Viasat is the first Ka-band IFC supplier to have a line-fit IFC solution available on the Embraer E2 family.

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By selecting Viasat’s IFC system as a factory option on the Embraer E2 aircraft prior to delivery, airlines will be able to offer, from day one of aircraft service, an advanced IFC experience to each passenger and flight crew member, while avoiding costly down-time associated with taking aircraft out of service for post-production IFC retrofits., multiple airlines, including Azul Airlines, have selected Embraer E2 aircraft equipped with Viasat’s IFC system direct from the factory.

Embraer S.A. stock has also loss -8.07% of its value over the past 7 days. However, ERJ stock has inclined by 4.91% in the 3 months of the year. Over the past six months meanwhile, it has gained 23.76% and gained 122.61% year-on date.

The market cap for ERJ stock reached $2.95 billion, with 183.69 million shares outstanding and 175.18 million shares in the current float. Compared to the average trading volume of 2.35M shares, ERJ reached a trading volume of 4255655 in the most recent trading day, which is why market watchdogs consider the stock to be active.

Here’s what leading stock market gurus have to say 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 $22.25 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 2.50. 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.

UBS have made an estimate for Embraer S.A. shares, keeping their opinion on the stock as Buy, with their previous recommendation back on November 11, 2021. The new note on the price target was released on September 23, 2021, representing the official price target for Embraer S.A. stock. Previously, the target price had yet another raise from $8 to $20, while BofA Securities kept a Buy rating on ERJ stock.

The Average True Range (ATR) for Embraer S.A. is set at 0.87, with the Price to Sales ratio for ERJ stock in the period of the last 12 months amounting to 0.63. The Price to Book ratio for the last quarter was 1.02, with the Price to Cash per share for the same quarter was set at 12.70. Price to Free Cash Flow for ERJ in the course of the last twelve months was 9.95 with Quick ratio for the last quarter at 1.30.

ERJ stock trade performance evaluation

Embraer S.A. [ERJ] fell into the red zone at the end of the last week, falling into a negative trend and dropping by -8.07. With this latest performance, ERJ shares dropped by -14.64% in over the last four-week period, additionally plugging by 23.76% over the last 6 months – not to mention a rise of 150.99% 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 40.35, with the RSI for the last a single of trading hit 37.40, and the three-weeks RSI is set at 42.75 for Embraer S.A. [ERJ]. The present Moving Average for the last 50 days of trading for this stock 16.91, while it was recorded at 16.17 for the last single week of trading, and 13.69 for the last 200 days.

Embraer S.A. [ERJ]: An insightful look at the core fundamentals

Operating Margin for any stock indicates how profitable investing would be, and Embraer S.A. [ERJ] shares currently have an operating margin of -3.64 and a Gross Margin at +12.25. Embraer S.A.’s Net Margin is presently recorded at -18.41.

Return on Total Capital for ERJ is now -2.66, given the latest momentum, and Return on Invested Capital for the company is -14.28. Return on Equity for this stock declined to -25.14, with Return on Assets sitting at -7.42. When it comes to the capital structure of this company, Embraer S.A. [ERJ] has a Total Debt to Total Equity ratio set at 159.67. Additionally, ERJ Total Debt to Total Capital is recorded at 61.49, with Total Debt to Total Assets ending up at 42.78. Long-Term Debt to Equity for the company is recorded at 145.98, with the Long-Term Debt to Total Capital now at 56.22.

Reflecting on the efficiency of the workforce at the company, Embraer S.A. [ERJ] managed to generate an average of -$230,937 per employee. Receivables Turnover for the company is 5.25 with a Total Asset Turnover recorded at a value of 0.40.Embraer S.A.’s liquidity data is similarly interesting compelling, with a Quick Ratio of 1.30 and a Current Ratio set at 2.00.

Earnings per share (EPS) analysis for Embraer S.A. [ERJ] stock

With the latest financial reports released by the company, Embraer S.A. posted -0.81/share EPS, while the average EPS was predicted by analysts to be reported at -0.45/share. When compared, the two values demonstrate that the company fail the estimates by a Surprise Factor of -80.00%. 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%.

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Embraer S.A. [ERJ]: Insider Ownership positions

There are presently around $1,019 million, or 39.80% 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 21,053,274, which is approximately -10.66% of the company’s market cap and around 12.40% of the total institutional ownership; AMERICAN CENTURY COMPANIES INC, holding 4,427,397 shares of the stock with an approximate value of $67.12 million in ERJ stocks shares; and OLDFIELD PARTNERS LLP, currently with $59.0 million in ERJ stock with ownership of nearly -11.756% of the company’s market capitalization.

Positions in Embraer S.A. stocks held by institutional investors increased at the end of November and at the time of the November reporting period, where 69 institutional holders increased their position in Embraer S.A. [NYSE:ERJ] by around 7,012,849 shares. Additionally, 79 investors decreased positions by around 11,790,743 shares, while 19 investors held positions by with 48,440,964 shares. The mentioned changes placed institutional holdings at 67,244,556 shares, according to the latest SEC report filing. ERJ stock had 29 new institutional investments in for a total of 2,314,007 shares, while 23 institutional investors sold positions of 3,492,943 shares during the same period.