On February 11, 2013, we upgraded our recommendation on
aircraft manufacturing company,
) from Underperform to Neutral based on its improved prospects.
Embraer, which focuses on the commercial and defense jets market,
holds a Zacks #3 Rank (Hold).
Why the Upgrade?
Embraer maintains a series of healthy contracts, along with
tie-ups with many established market players. Also, the company
invests plenty of time and resources for the invention of new
technologies and launch of new products, which are efficient and
The company intends to launch its second generation E-Jets in
the year 2018. Around a week back, Embraer entered into an
agreement with Honeywell International Plc., to procure advanced
avionics systems of the latter for its new E-Jets. Embraer is
keen on having superior suppliers for its new E-jets, so that an
enhanced and efficient version of the product can be delivered.
For this purpose, it also selected Pratt and Whitney Canada
International Inc. last month, to deliver engines for the
The company is expected to release its fourth quarter 2012
results on March 22, 2013. The Zacks Consensus Estimate stands at
84 cents, with an expected year-over-year growth of around
208.0%. With the current Zacks Rank and an Earnings ESP (Read:
Zacks Earnings ESP: A Better Method
) of 0.00%, the company is likely to perform in line with the
Other Stocks to Consider
Besides Embraer, other stocks in the aviation sector that are
currently performing well include
European Aeronautic Defence and Space Company EADS
) which carries a Zacks Rank #1 (Strong Buy), along with
Lockheed Martin Corporation
Huntington Ingalls Industries Inc.
); both carrying a Zacks Rank #2 (Buy).
(EADSY): ETF Research Reports
EMBRAER AIR-ADR (ERJ): Free Stock Analysis
HUNTINGTON INGL (HII): Free Stock Analysis
LOCKHEED MARTIN (LMT): Free Stock Analysis
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