Update shared on18 Sep 2025
Fair value Decreased 1.17%Despite a strong new $4.4B Avelo Airlines order boosting backlog and resilience in commercial and defense segments, Embraer's Analyst Price Target fell slightly to R$80.93 due to tariff-related EBIT risks primarily in Executive Aviation and lingering structural concerns.
Analyst Commentary
- Major new aircraft order with Avelo Airlines for up to 100 E195-E2s, valued at $4.4B, strengthens Embraer's backlog and revenue visibility.
- Bullish analysts see the recent pullback in shares following the announcement of a 50% U.S. tariff on Brazil as an attractive buying opportunity, anticipating a limited impact outside the Executive Aviation segment.
- Potential negative EBIT impact from the U.S. tariff on Brazil estimated at $300M-$400M annually, primarily affecting the Executive Aviation business.
- Bearish analysts acknowledge improved fundamentals but remain cautious due to persistent structural concerns despite raising price targets.
- Overall upward revisions in price targets driven by improved order flows and perceived resilience in Embraer's commercial and defense segments amidst tariff concerns.
What's in the News
- Avelo Airlines placed a firm order for 50 Embraer E195 E2 aircraft, with purchase rights for 50 more, making Avelo the first U.S. operator of Embraer's largest commercial jet and marking a significant milestone for the E2 program.
- Embraer signed a contract with Panama for the sale of four A-29 Super Tucano aircraft, expanding the Super Tucano's footprint in Latin America and reinforcing its market leadership in light-attack and surveillance platforms.
- Embraer was removed from the Brazil Valor BM&FBOVESPA Index.
- Embraer reaffirmed 2025 earnings guidance, targeting revenues of USD 7.0–7.5 billion and an adjusted EBIT margin of 7.5%–8.3%.
- Q2 2025 aircraft deliveries rose 30% year-over-year to 61 units, with first-half deliveries reaching 87 aircraft versus 71 a year earlier; full-year 2025 delivery guidance is 222–240 aircraft.
Valuation Changes
Summary of Valuation Changes for Embraer
- The Consensus Analyst Price Target remained effectively unchanged, moving only marginally from R$81.89 to R$80.93.
- The Consensus Revenue Growth forecasts for Embraer has fallen from 8.5% per annum to 8.0% per annum.
- The Future P/E for Embraer remained effectively unchanged, moving only marginally from 30.48x to 30.68x.
Disclaimer
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