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Brazil's Embraer Ups Q2 Deliveries, Reports Record Backlog - Analyst Blog

Embraer SAERJ , the Brazilian jet maker, delivered 60 jets in the second quarter of 2015, up from 58 deliveries in the year-ago quarter. What is even more heartening is that its backlog reached the highest level in the company's history.

Deliveries in the commercial aviation and business aviation markets were 27 and 33 jets, respectively. In comparison, the company had delivered 29 jets in each of the two categories in the year-ago quarter.

During the second quarter 2015, Embraer delivered 22 E-175s, 3 E-190s and 2 E-195s to the commercial aviation market, while the rest were delivered to the business aviation market, which included 26 Light jets and 7 Large jets.

Embraer reported an order backlog of $22.9 billion as of June, 2015. This represents a 26.5% increase from the year-ago period and 12.3% from the preceding quarter. In terms of aircraft breakdown, the company's order backlog comprises 168 E-175s, 100 E-175-E2s, 90 E-195-E2s, 77 E-190-E2s, 66 E-190s, 25 E-195s and 5 E-170 jets.

During the second quarter, the company received orders worth $2.6 billion at current list prices, at the Paris International Air Show. This included 7 E190 for China's Colorful Guizhou Airlines, 8 E175 for SkyWest Airlines, which will be operated by Alaska Airlines, 10 E175 for United Express and 15 E190-E2 and 10 E195-E2 for the lessor Aircastle.

The company's advanced E-2 commercial aircraft has become quite popular owing to its low costs, fuel efficiency and spacious cabins. Rising demand for E-jets will likely boost the company's growth prospects ahead.

Embraer operates in a highly competitive commercial aircraft manufacturing industry, dominated by The Boeing Co. BA and Airbus, with longer operating histories and established reputations. Embraer needs to invest steadily in technology and performance enhancement to keep pace with the growing demand in the commercial aircraft manufacturing market.

Embraer SA currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the aerospace and defense sector include Lockheed Martin Corporation LMT and Northrop Grumman Corp. NOC , both carrying a Zacks Rank #2 (Buy).

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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