Deutsche Bank Starts Embraer (ERJ) at Buy; Continuing To Stretch Its Wings

Deutsche Bank initiates coverage on Embraer (NYSE: ERJ) with a Buy. PT $38.00.

Deutsche analyst says, "With 75% of sales to the commercial aerospace OE markets, Embraer appears well positioned to benefit from the growth in production we see over the next several years. We are forecasting sales to grow at 10% CAGR and EPS +20% CAGR through 2014. Growth will largely be driven by ERJ’s business jet and commercial aviation divisions. The increased volumes should drive margins higher (we estimate ~25% incremental gross margins), as well as improving mix."

For more ratings news on Embraer click here and for the rating history of Embraer click here.

Shares of Embraer closed at $27.46 yesterday.

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