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The share price of the Brazilian aircraft manufacturer Embraer SA (ERJ - Analyst Report) inched up almost 1% on Friday, Oct 4 following a couple of good news for the company. Embraer announced the sale of three of its E195 jets to two European airlines, Belavia of Belarus and Guernsey-based Aurigny Air Services.

In a contract with Minsk-based Belavia, Embraer would supply two 122-seat E195s under a firm purchase agreement worth $80 million. Embraer also said Aurigny Air Services would take delivery of an E195 next year. Aurigny Air Services mainly flies between London Gatwick airport and Guernsey, a British dependency in the English Channel. Under this firm order, Embraer would receive $40 million at current list prices from the Guernsey-based Aurigny for one E195.

The orders will be included in Embraer's 2013 third quarter backlog and the deliveries of the first E195 are scheduled for the second half of 2014.

Embraer is the world's third largest commercial aircraft manufacturer following The Boeing Co. (BA - Analyst Report) and Europe's Airbus. With rising demand, Embraer’s firm order backlog totaled $17.1 billion during the second quarter, reflecting an increase of $3.8 billion from the sequentially preceding quarter.  It was the highest since Sep 2009.

In July, Embraer’s Commercial Aviation unit entered into an agreement, worth $2.85 billion at list prices, with International Lease Finance Corporation (“ILFC”) to deliver 50 E-Jets. The deal has an option to extend the potential order to up to 100 aircraft. This firm order was initially announced as a Letter of Intent at the Paris Air Show held in Jun 2013.

We believe these big-ticket deals, along with a series of contracts and tie-ups with several companies for its jets, will boost the performance of Embraer’s commercial aircraft division. Continuous demand for E-Jets demonstrates the confidence of its customers, which will improve forthcoming results.

Despite these initiatives, the company continues to perform below market expectation, falling short of the Zacks Consensus Estimate in the last four quarters with an average earnings miss of 36.12%. Embraer SA retains a Zacks Rank #4 (Sell).

However, there are other stocks in the space that are performing well, with a favorable Zacks Rank. These are Lockheed Martin Corp. (LMT - Analyst Report) and Northrop Grumman Corp. (NOC - Analyst Report) , each with a Zacks Ranks #2 (Buy).

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