Embraer shares hit new highs as SAS places order

By Stine Jacobsen and Gabriel Araujo

COPENHAGEN/SAO PAULO (Reuters) -Shares of Brazilian planemaker Embraer hit a fresh all-time high on Tuesday as it secured an order from Scandinavian Airline SAS for up to 55 aircraft, in a deal worth around $4 billion excluding purchase rights.

SAS has signed a firm deal for 45 E195-E2 aircraft, with options for an additional 10, CEO Anko van der Werff told reporters at a press conference in Copenhagen. Deliveries are set to begin in late 2027.

The deal will make Scandinavia's biggest carrier one of the largest operators of Embraer's E2 family, and signals positive demand for the planemaker's next-generation jetliners, according to analysts.

Sao Paulo-traded shares of Embraer jumped as much as 5.5% on the news, reaching a new intraday record and making it the top performer on Brazil's benchmark stock index Bovespa, which was up 0.3%.

The world's third-largest planemaker after Airbus and Boeing has been riding tailwinds on the back of robust demand, with its shares having surged over 40% year-to-date after gains of more than 150% in 2024.

The SAS deal "confirms the momentum of Embraer's ongoing order campaigns and backlog expansion, important factors for our 'Overweight' rating," analysts at JPMorgan said in a note to clients.

SAS said that the E195-E2's size and range were ideally suited to complement its existing fleet and route structure, allowing for more frequencies, better network flexibility and lower trip costs.

The narrowbody aircraft seats up to 146 passengers and is the largest member of Embraer's family of regional jets, competing with the Airbus A220.

Both models occupy a segment of the market for commercial passenger jets below the main one dominated by Airbus and Boeing, but are subject to equally fierce competition.

The SAS deal follows a setback for Embraer last month, when Airbus sealed an order for 40 A220 jets from Polish national carrier LOT after a hard-fought contest with the Brazilian firm.

Embraer noted that the fresh deal is SAS's largest jet order direct from a manufacturer since 1996.

Santander analysts praised the order's size as particularly meaningful for Embraer, saying it indicates demand picking up for the E2 family. Other large E2 operators include Canada's Porter Airlines, Brazil's Azul and KLM.

(Reporting by Stine Jacobsen in Copenhagen and Gabriel Araujo in Sao Paulo; Editing by Louise Breusch Rasmussen, Emelia Sithole-Matarise and David Evans)