Why Embraer Shares Fell in November
The military arm of aerospace manufacturer Embraer (NYSE: ERJ) suffered a setback at the hands of the Brazilian Air Force, and the stock traded down as a result. Shares of Embraer lost 12.7% in November, according to data from S&P Global Market Intelligence, on investor concerns that the company will have a hard time backfilling the lost orders.
Embraer, a Brazil-based manufacturer of commercial jets and military equipment, has long had close ties with its home government. But the Brazilian federal government dealt the company a blow in mid-November, when it decided to reduce its order for Embraer-made KC-390 transport planes from 28 units to 15. Factoring in compensation for R&D work and other revenue, Embraer said the decision would reduce the total contract value on the order by 25%.
Image source: Embraer.
Source Fool.com