While Boeing continues to struggle, rival Embraer looks to weather some turbulence. Wall Street forecasts 315% earnings growth this quarter for the Brazilian aircraft maker, and a 220% gain for the year. And as Boeing stock works through its extended descent and a guilty plea surrounding 737 Max crashes, Embraer stock has landed a spot on IBD Leaderboard, aiming to refuel a recent breakout attempt.
First Full-Scale Vertical Takeoff Prototype Unveiled
Embraer ranks as the third-largest commercial aircraft maker after Boeing and Airbus. An Embraer aircraft takes to the skies every 10 seconds, and its planes carry roughly 145 million passengers every year. Embraer's business segments include commercial aviation, defense and security, executive aviation and services and support.
In 2020, Embraer created Eve Air Mobility, an independent company that went public in 2021. Eve Air Mobility began life as an innovation project known as Embraer-X. Embraer's goal for Eve Air Mobility is to make the market in Urban Air Mobility, or UAM, a reality. The UAM market focuses on aircraft to transport people and goods through urban areas on demand.
At the 45th Farnborough Airshow taking place this week, Florida-based Eve Air Mobility unveiled the first full-scale eVTOL prototype, which is being built by Embraer. Standing for electric vertical takeoff and landing, eVTOLs are sometimes referred to as flying taxis or air taxis.
In sync with Embraer's goals for its UAM efforts, Eve Air Chief Executive Johann Bordais said, "We are not just creating an aircraft, we're building a comprehensive ecosystem of solutions that will shape the future of the Advanced Air Mobility industry."
Embraer Stock: Huge Earnings Estimates
Embraer's recent results show accelerating growth in earnings. On May 7, the company reported first-quarter earnings growth of 86%. When the aircraft maker next reports on Aug. 8, Wall Street forecasts 315% earnings growth to 21 cents a share.
Embraer delivered 25% revenue growth during the first quarter and analysts see an 8% rise in revenue in the second quarter to just under $1.4 billion.
For the full year, analysts see Embraer posting 220% earnings growth to $1.39 a share.
In IBD Stock Checkup, Embraer earns a near-perfect 98 Composite Rating. Showing demand, Embraer stock sports a B Accumulation/Distribution Rating and a 1.3 up/down volume ratio.
Embraer Stock Tests Support After Teasing Record High
Embraer initially cleared a double-bottom entry at 29.95 on July 12. Shares then meandered around that buy point for several days before spiking to briefly hit an all-time high Friday. But that same day, the stock reversed, maintaining nearly a 2% gain but failing to hold the buy point.
On Monday, Embraer continued that negative reversal. The stock fell nearly 7% in above-average volume.
Embraer was holding above the 50-day moving average earlier in the day, but closed below it. See if Embraer can find its footing and refuel its failing breakout.
Meanwhile, Boeing stock continues to slump, reversing back below its 50-day line on Monday. Boeing reports its latest numbers on July 31.
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