Earnings Miss: Embraer S.A. Missed EPS By 50% And Analysts Are Revising Their Forecasts
Shareholders of Embraer S.A. (BVMF:EMBJ3) will be pleased this week, given that the stock price is up 13% to R$115 following its latest quarterly results. Revenue of R$12b surpassed estimates by 6.0%, although statutory earnings per share missed badly, coming in 50% below expectations at R$0.52 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Embraer after the latest results.
Taking into account the latest results, the consensus forecast from Embraer's 14 analysts is for revenues of R$53.6b in 2027. This reflects a meaningful 18% improvement in revenue compared to the last 12 months. Before this earnings report, the analysts had been forecasting revenues of R$53.3b and earnings per share (EPS) of R$5.86 in 2027. Overall, while the analysts have reconfirmed their revenue estimates, the consensus now no longer provides an EPS estimate. This implies that the market believes revenue is more important after these latest results.
Check out our latest analysis for Embraer
There's been no real change to the consensus price target of R$123, with Embraer seemingly executing in line with expectations. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Embraer analyst has a price target of R$145 per share, while the most pessimistic values it at R$111. We would probably assign less value to the analyst forecasts in this situation, because such a wide range of estimates could imply that the future of this business is difficult to value accurately. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We can infer from the latest estimates that forecasts expect a continuation of Embraer'shistorical trends, as the 14% annualised revenue growth to the end of 2027 is roughly in line with the 17% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 11% per year. So it's pretty clear that Embraer is forecast to grow substantially faster than its industry.
The Bottom Line
The most important thing to take away is that the analysts reconfirmed their revenue estimates for next year, suggesting that the business is performing in line with expectations. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
At least one of Embraer's 14 analysts has provided estimates out to 2028, which can be seen for free on our platform here.
You can also see our analysis of Embraer's Board and CEO remuneration and experience, and whether company insiders have been buying stock.
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