EMBRAER SA-SPON ADR (ERJ) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:ERJ - US29082A1079 - ADR
64.48 USD
-0.74 (-1.13%)
64.48 USD
0 (0%)
Taking everything into account, ERJ scores 4 out of 10 in our fundamental rating. ERJ was compared to 72 industry peers in the Aerospace & Defense industry. There are concerns on the financial health of ERJ while its profitability can be described as average. ERJ is valued quite expensive, but it does show an excellent growth.
1. Profitability
1.1 Basic Checks
ERJ had positive earnings in the past year.
In the past year ERJ had a positive cash flow from operations.
In multiple years ERJ reported negative net income over the last 5 years.
ERJ had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
ERJ has a Return On Assets (3.25%) which is in line with its industry peers.
ERJ's Return On Equity of 11.75% is fine compared to the rest of the industry. ERJ outperforms 78.08% of its industry peers.
ERJ has a better Return On Invested Capital (6.92%) than 60.27% of its industry peers.
The Average Return On Invested Capital over the past 3 years for ERJ is significantly below the industry average of 8.58%.
The last Return On Invested Capital (6.92%) for ERJ is above the 3 year average (3.04%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.25% | ||
| ROE | 11.75% | ||
| ROIC | 6.92% |
ROA(3y)0.77%
ROA(5y)-0.96%
ROE(3y)2.92%
ROE(5y)-3.58%
ROIC(3y)3.04%
ROIC(5y)N/A
1.3 Margins
ERJ's Profit Margin of 5.37% is in line compared to the rest of the industry. ERJ outperforms 58.90% of its industry peers.
ERJ has a better Operating Margin (10.98%) than 71.23% of its industry peers.
In the last couple of years the Operating Margin of ERJ has grown nicely.
Looking at the Gross Margin, with a value of 18.48%, ERJ is doing worse than 68.49% of the companies in the same industry.
In the last couple of years the Gross Margin of ERJ has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.98% | ||
| PM (TTM) | 5.37% | ||
| GM | 18.48% |
OM growth 3Y26.36%
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y5.14%
GM growth 5Y4.37%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so ERJ is destroying value.
Compared to 1 year ago, ERJ has about the same amount of shares outstanding.
ERJ has about the same amout of shares outstanding than it did 5 years ago.
The debt/assets ratio for ERJ has been reduced compared to a year ago.
2.2 Solvency
ERJ has an Altman-Z score of 1.80. This is a bad value and indicates that ERJ is not financially healthy and even has some risk of bankruptcy.
ERJ has a worse Altman-Z score (1.80) than 72.60% of its industry peers.
ERJ has a debt to FCF ratio of 4.50. This is a neutral value as ERJ would need 4.50 years to pay back of all of its debts.
The Debt to FCF ratio of ERJ (4.50) is better than 73.97% of its industry peers.
A Debt/Equity ratio of 0.65 indicates that ERJ is somewhat dependend on debt financing.
With a Debt to Equity ratio value of 0.65, ERJ is not doing good in the industry: 68.49% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.65 | ||
| Debt/FCF | 4.5 | ||
| Altman-Z | 1.8 |
ROIC/WACC0.54
WACC12.84%
2.3 Liquidity
ERJ has a Current Ratio of 1.33. This is a normal value and indicates that ERJ is financially healthy and should not expect problems in meeting its short term obligations.
ERJ has a Current ratio of 1.33. This is in the lower half of the industry: ERJ underperforms 72.60% of its industry peers.
ERJ has a Quick Ratio of 1.33. This is a bad value and indicates that ERJ is not financially healthy enough and could expect problems in meeting its short term obligations.
ERJ has a Quick ratio of 0.60. This is amonst the worse of the industry: ERJ underperforms 86.30% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.33 | ||
| Quick Ratio | 0.6 |
3. Growth
3.1 Past
ERJ shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 251.40%, which is quite impressive.
Looking at the last year, ERJ shows a very strong growth in Revenue. The Revenue has grown by 35.67%.
ERJ shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 10.19% yearly.
EPS 1Y (TTM)251.4%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%439.99%
Revenue 1Y (TTM)35.67%
Revenue growth 3Y16.04%
Revenue growth 5Y10.19%
Sales Q2Q%539.25%
3.2 Future
ERJ is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 19.02% yearly.
The Revenue is expected to grow by 67.32% on average over the next years. This is a very strong growth
EPS Next Y-19.18%
EPS Next 2Y16.82%
EPS Next 3Y19.02%
EPS Next 5YN/A
Revenue Next Year23.64%
Revenue Next 2Y17.29%
Revenue Next 3Y14.45%
Revenue Next 5Y67.32%
3.3 Evolution
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 49.60, ERJ can be considered very expensive at the moment.
Compared to the rest of the industry, the Price/Earnings ratio of ERJ is on the same level as its industry peers.
ERJ's Price/Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 26.49.
The Price/Forward Earnings ratio is 100.24, which means the current valuation is very expensive for ERJ.
Compared to the rest of the industry, the Price/Forward Earnings ratio of ERJ indicates a slightly more expensive valuation: ERJ is more expensive than 63.01% of the companies listed in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 23.69. ERJ is valued rather expensively when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 49.6 | ||
| Fwd PE | 100.24 |
4.2 Price Multiples
95.89% of the companies in the same industry are more expensive than ERJ, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, ERJ is valued cheaply inside the industry as 90.41% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.54 | ||
| EV/EBITDA | 11.36 |
4.3 Compensation for Growth
ERJ's earnings are expected to grow with 19.02% in the coming years. This may justify a more expensive valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y16.82%
EPS Next 3Y19.02%
5. Dividend
5.1 Amount
With a yearly dividend of 0.19%, ERJ is not a good candidate for dividend investing.
ERJ's Dividend Yield is a higher than the industry average which is at 1.12.
With a Dividend Yield of 0.19, ERJ pays less dividend than the S&P500 average, which is at 2.31.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.19% |
5.2 History
ERJ has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
2.42% of the earnings are spent on dividend by ERJ. This is a low number and sustainable payout ratio.
DP2.42%
EPS Next 2Y16.82%
EPS Next 3Y19.02%
64.48
-0.74 (-1.13%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryAerospace & Defense
Earnings (Last)
Earnings (Next)
Inst Owners41.68%
Inst Owner Change3.55%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap11.84B
Revenue(TTM)35.42B
Net Income(TTM)2.14B
Analysts78.46
Price Target66.24 (2.73%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.19% |
Yearly Dividend0
Dividend Growth(5Y)N/A
DP2.42%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-272.61%
Min EPS beat(2)-435.01%
Max EPS beat(2)-110.2%
EPS beat(4)1
Avg EPS beat(4)-143.24%
Min EPS beat(4)-435.01%
Max EPS beat(4)3.26%
EPS beat(8)2
Avg EPS beat(8)-84.2%
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)0
Avg Revenue beat(2)-5.43%
Min Revenue beat(2)-9.14%
Max Revenue beat(2)-1.72%
Revenue beat(4)1
Avg Revenue beat(4)-2.07%
Min Revenue beat(4)-9.14%
Max Revenue beat(4)3.89%
Revenue beat(8)2
Avg Revenue beat(8)-3.54%
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)8.75%
PT rev (3m)19.06%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-16.64%
EPS NY rev (1m)0%
EPS NY rev (3m)-59.9%
Revenue NQ rev (1m)0.14%
Revenue NQ rev (3m)11.92%
Revenue NY rev (1m)0%
Revenue NY rev (3m)3.23%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 49.6 | ||
| Fwd PE | 100.24 | ||
| P/S | 1.6 | ||
| P/FCF | 22.54 | ||
| P/OCF | 11.36 | ||
| P/B | 3.49 | ||
| P/tB | 16.02 | ||
| EV/EBITDA | 11.36 |
EPS(TTM)1.3
EY2.02%
EPS(NY)0.64
Fwd EY1%
FCF(TTM)2.86
FCFY4.44%
OCF(TTM)5.68
OCFY8.8%
SpS40.41
BVpS18.47
TBVpS4.03
PEG (NY)N/A
PEG (5Y)N/A
Graham Number23.24
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.25% | ||
| ROE | 11.75% | ||
| ROCE | 11.18% | ||
| ROIC | 6.92% | ||
| ROICexc | 8.39% | ||
| ROICexgc | 15.02% | ||
| OM | 10.98% | ||
| PM (TTM) | 5.37% | ||
| GM | 18.48% | ||
| FCFM | 7.08% |
ROA(3y)0.77%
ROA(5y)-0.96%
ROE(3y)2.92%
ROE(5y)-3.58%
ROIC(3y)3.04%
ROIC(5y)N/A
ROICexc(3y)4.39%
ROICexc(5y)N/A
ROICexgc(3y)8.44%
ROICexgc(5y)N/A
ROCE(3y)4.92%
ROCE(5y)N/A
ROICexgc growth 3Y38.8%
ROICexgc growth 5YN/A
ROICexc growth 3Y37.44%
ROICexc growth 5YN/A
OM growth 3Y26.36%
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y5.14%
GM growth 5Y4.37%
F-Score7
Asset Turnover0.6
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.65 | ||
| Debt/FCF | 4.5 | ||
| Debt/EBITDA | 2.05 | ||
| Cap/Depr | 192.1% | ||
| Cap/Sales | 6.97% | ||
| Interest Coverage | 4.75 | ||
| Cash Conversion | 96.2% | ||
| Profit Quality | 131.81% | ||
| Current Ratio | 1.33 | ||
| Quick Ratio | 0.6 | ||
| Altman-Z | 1.8 |
F-Score7
WACC12.84%
ROIC/WACC0.54
Cap/Depr(3y)162.83%
Cap/Depr(5y)138.44%
Cap/Sales(3y)6.98%
Cap/Sales(5y)6.64%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)251.4%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%439.99%
EPS Next Y-19.18%
EPS Next 2Y16.82%
EPS Next 3Y19.02%
EPS Next 5YN/A
Revenue 1Y (TTM)35.67%
Revenue growth 3Y16.04%
Revenue growth 5Y10.19%
Sales Q2Q%539.25%
Revenue Next Year23.64%
Revenue Next 2Y17.29%
Revenue Next 3Y14.45%
Revenue Next 5Y67.32%
EBIT growth 1Y167.12%
EBIT growth 3Y46.63%
EBIT growth 5YN/A
EBIT Next Year63.72%
EBIT Next 3Y30.25%
EBIT Next 5Y84.28%
FCF growth 1Y2182.11%
FCF growth 3Y29.27%
FCF growth 5Y15.04%
OCF growth 1Y213.88%
OCF growth 3Y24.7%
OCF growth 5Y8.09%
EMBRAER SA-SPON ADR / ERJ FAQ
What is the fundamental rating for ERJ stock?
ChartMill assigns a fundamental rating of 4 / 10 to ERJ.
What is the valuation status of EMBRAER SA-SPON ADR (ERJ) stock?
ChartMill assigns a valuation rating of 3 / 10 to EMBRAER SA-SPON ADR (ERJ). This can be considered as Overvalued.
How profitable is EMBRAER SA-SPON ADR (ERJ) stock?
EMBRAER SA-SPON ADR (ERJ) has a profitability rating of 5 / 10.
What is the valuation of EMBRAER SA-SPON ADR based on its PE and PB ratios?
The Price/Earnings (PE) ratio for EMBRAER SA-SPON ADR (ERJ) is 49.6 and the Price/Book (PB) ratio is 3.49.
What is the earnings growth outlook for EMBRAER SA-SPON ADR?
The Earnings per Share (EPS) of EMBRAER SA-SPON ADR (ERJ) is expected to decline by -19.18% in the next year.