Financial Contrast: Embraer-Empresa Brasileira de Aeronautica (NYSE:ERJ) versus Redwire (NYSE:RDW)

Embraer-Empresa Brasileira de Aeronautica (NYSE:ERJ) and Redwire (NYSE:RDW) are both mid-cap aerospace companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, risk, dividends, profitability, earnings, institutional ownership and valuation.

Volatility & Risk

Embraer-Empresa Brasileira de Aeronautica has a beta of 1.72, suggesting that its share price is 72% more volatile than the S&P 500. Comparatively, Redwire has a beta of 2.54, suggesting that its share price is 154% more volatile than the S&P 500.

Institutional and Insider Ownership

34.7% of Embraer-Empresa Brasileira de Aeronautica shares are owned by institutional investors. Comparatively, 8.1% of Redwire shares are owned by institutional investors. 1.0% of Embraer-Empresa Brasileira de Aeronautica shares are owned by insiders. Comparatively, 2.6% of Redwire shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Embraer-Empresa Brasileira de Aeronautica and Redwire”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Embraer-Empresa Brasileira de Aeronautica	$6.39 billion	1.42	$352.50 million	$2.16	22.84
Redwire	$304.10 million	9.10	-$114.32 million	($2.26)	-8.58

Embraer-Empresa Brasileira de Aeronautica has higher revenue and earnings than Redwire. Redwire is trading at a lower price-to-earnings ratio than Embraer-Empresa Brasileira de Aeronautica, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Embraer-Empresa Brasileira de Aeronautica and Redwire’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Embraer-Empresa Brasileira de Aeronautica	6.02%	16.43%	4.76%
Redwire	-39.31%	N/A	-16.63%

Analyst Recommendations

This is a summary of recent ratings for Embraer-Empresa Brasileira de Aeronautica and Redwire, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Embraer-Empresa Brasileira de Aeronautica	1	1	3	2	2.86
Redwire	0	2	6	0	2.75

Embraer-Empresa Brasileira de Aeronautica currently has a consensus target price of $50.40, suggesting a potential upside of 2.15%. Redwire has a consensus target price of $19.61, suggesting a potential upside of 1.07%. Given Embraer-Empresa Brasileira de Aeronautica’s stronger consensus rating and higher probable upside, analysts clearly believe Embraer-Empresa Brasileira de Aeronautica is more favorable than Redwire.

Summary

Embraer-Empresa Brasileira de Aeronautica beats Redwire on 11 of the 15 factors compared between the two stocks.

About Embraer-Empresa Brasileira de Aeronautica

Embraer S.A. designs, develops, manufactures, and sells aircraft and systems in North America, Latin America, the Asia Pacific, Brazil, Europe, and internationally. The company operates through Commercial Aviation; Defense & Security; Executive Aviation; Services & Support; and Other segments. The Commercial Aviation segment designs, develops, manufactures, and sells commercial jets, as well as leases aircraft. The Defense & Security segment engages in the research, development, production, modification, and support for military defense and security aircraft; and offers a range of products and integrated solutions that include radars, special space systems, and cyber security solutions, as well as information and communications systems comprising command, control, communications, computer, intelligence, surveillance, and reconnaissance systems. The Executive Aviation segment develops, produces, and sells executive jets. This segment also leases Phenom family executive jets in the entry jet and light jet categories; and Praetor 500 and Praetor 600, disruptive executive jets in the midsize and super midsize categories. The Service & Support segment provides after-service solutions and support services; maintenance, repair, and overhaul services for commercial, executive, and defense aircraft; and aircraft components and engines. This segment also supplies steel and composite aviation structures to various aircraft manufacturers. The Other segment engages in the supply of fuel systems, structural parts, and mechanical and hydraulic systems; and production of agricultural crop-spraying aircraft. The company was formerly known as Embraer-Empresa Brasileira de Aeronáutica S.A. and changed its name to Embraer S.A. in November 2010. Embraer S.A. was incorporated in 1969 and is headquartered in São Paulo, Brazil.

About Redwire

Redwire Corporation provides critical space solutions and space infrastructure for government and commercial customers in the United States, Europe, and internationally. The company provides avionics and sensors including star trackers, sun sensors, critical for navigation, and control of spacecraft; camera systems; solar array solutions for spacecraft spanning the spectrum of size, power needs, and orbital location; and strain composite booms, coilable booms, truss structures, telescope baffles, and deployable booms to position sensors or solar arrays away from the spacecraft. It offers software suite that enables digital engineering and generation of high-fidelity, interactive modeling and simulations of individual components, entire spacecraft, and full constellations in a cloud-based environment. In addition, the company microgravity payloads, radio frequency systems, antennas, star trackers, platforms, and in-space manufacturing and biotech facilities. Redwire Corporation is headquartered in Jacksonville, Florida.