Embraer S.A. (ERJ): Today's Featured Aerospace/Defense Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Embraer S.A ( ERJ) pushed the Aerospace/Defense industry lower today making it today's featured Aerospace/Defense laggard. The industry as a whole closed the day up 0.5%. By the end of trading, Embraer S.A fell 73 cents (-2%) to $34.83 on average volume. Throughout the day, 998,109 shares of Embraer S.A exchanged hands as compared to its average daily volume of one million shares. The stock ranged in price between $34.71-$35.45 after having opened the day at $35.45 as compared to the previous trading day's close of $35.56. Other companies within the Aerospace/Defense industry that declined today were: Innovative Solutions and Support ( ISSC), down 5.2% and Moog ( MOG.A), down 1.8%.
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Embraer S.A. develops, produces, and sells jet and turboprop aircrafts for civil and defense aviation markets. Embraer S.A has a market cap of $6.42 billion and is part of the industrial goods sector. The company has a P/E ratio of 59.1, above the S&P 500 P/E ratio of 17.7. Shares are up 24.7% year to date as of the close of trading on Thursday. Currently there are six analysts that rate Embraer S.A a buy, one analyst rates it a sell, and four rate it a hold.

TheStreet Ratings rates Embraer S.A as a hold. The company's strengths can be seen in multiple areas, such as its increase in net income, revenue growth and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, weak operating cash flow and poor profit margins.

On the positive front, Astrotech Corporation ( ASTC), up 4.8%, Heico Corporation ( HEI.A), up 3.8%, Orbital Sciences Corporation ( ORB), up 2.9%, and Hexcel Corporation ( HXL), up 2.2%, were all gainers within the aerospace/defense industry with Raytheon Company ( RTN) being today's featured aerospace/defense industry leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the aerospace/defense industry could consider iShares DJ US Aerospace & Def Idx ( ITA) while those bearish on the aerospace/defense industry could consider ProShares Short Dow 30 ( DOG).

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