EMBRAER SA-SPON ADR (ERJ) Stock Fundamental Analysis
USA - NYSE:ERJ - US29082A1079 - ADR
64.48 USD
-0.74 (-1.13%)
64.48 USD
0 (0%)
We assign a fundamental rating of 4 out of 10 to ERJ. ERJ was compared to 72 industry peers in the Aerospace & Defense industry. ERJ has a medium profitability rating, but doesn't score so well on its financial health evaluation. 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.
ERJ had a positive operating cash flow in the past year.
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
The Return On Assets of ERJ (3.25%) is comparable to the rest of the industry.
With a decent Return On Equity value of 11.75%, ERJ is doing good in the industry, outperforming 78.08% of the companies in the same industry.
ERJ's Return On Invested Capital of 6.92% is fine compared to the rest of the industry. ERJ outperforms 60.27% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for ERJ is significantly below the industry average of 8.46%.
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 has a Profit Margin of 5.37%. This is comparable to the rest of the industry: ERJ outperforms 58.90% of its industry peers.
With a decent Operating Margin value of 10.98%, ERJ is doing good in the industry, outperforming 71.23% of the companies in the same industry.
ERJ's Operating Margin has improved in the last couple of years.
With a Gross Margin value of 18.48%, ERJ is not doing good in the industry: 68.49% of the companies in the same industry are doing better.
ERJ's Gross Margin has improved in the last couple of years.
| 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
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), ERJ is destroying value.
ERJ has about the same amout of shares outstanding than it did 1 year ago.
The number of shares outstanding for ERJ remains at a similar level compared to 5 years ago.
ERJ has a better debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 1.80, we must say that ERJ is in the distress zone and has some risk of bankruptcy.
With a Altman-Z score value of 1.80, ERJ is not doing good in the industry: 72.60% of the companies in the same industry are doing better.
The Debt to FCF ratio of ERJ is 4.50, which is a neutral value as it means it would take ERJ, 4.50 years of fcf income to pay off all of its debts.
ERJ has a Debt to FCF ratio of 4.50. This is in the better half of the industry: ERJ outperforms 73.97% of its industry peers.
ERJ has a Debt/Equity ratio of 0.65. This is a neutral value indicating ERJ is somewhat dependend on debt financing.
ERJ has a Debt to Equity ratio of 0.65. This is in the lower half of the industry: ERJ underperforms 68.49% of its industry peers.
| 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 worse Current ratio (1.33) than 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.
ERJ shows a strong growth in Revenue. In the last year, the Revenue has grown by 35.67%.
Measured over the past years, ERJ shows a quite strong growth in Revenue. The Revenue has been growing by 10.19% on average per year.
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
Based on estimates for the next years, ERJ will show a quite strong growth in Earnings Per Share. The EPS will grow by 19.02% on average per year.
Based on estimates for the next years, ERJ will show a very strong growth in Revenue. The Revenue will grow by 67.32% on average per year.
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
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 49.60, which means the current valuation is very expensive for ERJ.
ERJ's Price/Earnings is on the same level as the industry average.
Compared to an average S&P500 Price/Earnings ratio of 26.28, ERJ is valued quite expensively.
A Price/Forward Earnings ratio of 100.24 indicates a quite expensive valuation of 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.
ERJ is valuated expensively when we compare the Price/Forward Earnings ratio to 33.61, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 49.6 | ||
| Fwd PE | 100.24 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ERJ indicates a rather cheap valuation: ERJ is cheaper than 95.89% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of ERJ indicates a rather cheap valuation: ERJ is cheaper than 90.41% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.54 | ||
| EV/EBITDA | 11.36 |
4.3 Compensation for Growth
A more expensive valuation may be justified as ERJ's earnings are expected to grow with 19.02% in the coming years.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y16.82%
EPS Next 3Y19.02%
5. Dividend
5.1 Amount
ERJ has a yearly dividend return of 0.19%, which is pretty low.
Compared to an average industry Dividend Yield of 1.12, ERJ pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.36, ERJ's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.19% |
5.2 History
ERJ has paid a dividend for at least 10 years, which is 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 Change-2.68%
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 %1.94%
Short Ratio2.66
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.