Imperial Capital Maintains Positive Outlook On Embraer SA

In a report published Friday, Imperial Capital analyst Bob McAdoo reiterated an Outperform rating and $40.00 price target on Embraer SA (ADR) (NYSE: ERJ).

In the report, Imperial Capital noted, "We are maintaining our Outperform rating and one-year price target of $40 on ERJ shares. Embraer should continue to be a long-term beneficiary as carriers continue to shift away from 50-seat regional aircraft to the larger more efficient E-Series. Demand for E175 aircraft and new E2 Series commercial aircraft should more than offset the current weak trends in the executive aviation segment. We also expect the company to benefit somewhat from the depreciation of the Brazilian Real against the U.S. dollar as the majority of operating expenses are in the local currency. Near term, we continue to expect shares of ERJ to trade closely with the flow of new orders rather than lumpier quarterly deliveries. Our price target represents about 20% potential upside, based on the recent share price."

Embraer SA closed on Thursday at $33.33.