11 Undervalued Aerospace Stocks To Buy According to Hedge Funds

7. Embraer S.A. (NYSE:ERJ)

Forward Price to Earnings Ratio: 22.08

Number of Hedge Fund Holders: 25

Embraer S.A. (NYSE:ERJ) is a Brazilian aerospace company that manufactures aircraft for commercial and executive aviation, defense, and security purposes. It is the third-largest maker of civil aircraft in the world.

Robust demand for Embraer’s executive jets is one of the major drivers for its growth. The company has delivered 86 aircraft this year and is on track to meet its delivery forecast of 125 to 135 jets for the full year. It delivered 41 of these during its most recent quarter (Q3 2024), comprising 22 light jets and 19 medium jets. This was the best quarter for the segment in terms of revenue and deliveries, demonstrating sustainable demand across the business jets portfolio.

Embraer S.A. (NYSE:ERJ) Defense & Security business is also booming. Revenue for the division has expanded 56% during the first nine months of fiscal 2024. Some recent highlights include the deliveries of C-390 Millenium to Hungary and Brazil and orders received for the aircraft from the Netherlands and Austria. ERJ has also received fresh contracts from Paraguay and Uruguay to acquire the A-29 Super Tucanos.

Embraer (NYSE:ERJ) is also making advancements in electric aviation, especially in the development of electric vertical takeoff and landing (eVTOL) aircraft, which is considered to be the next step in the future of urban air mobility.

Wall Street analysts are bullish on the stock, with a consensus Buy rating. As per Insider Monkey’s database for Q3 2024, 25 hedge funds held a stake in the company, making Embraer one of the best aerospace stocks to invest in.