Summarize and humanize this content to 2000 words in 6 paragraphs in English We recently published a list of Why These Defense Stocks Are Declining This Week. In this article, we will take a look at where Embraer S.A. (NYSE:ERJ) stands against other stocks that are declining this week. Defense stocks across the world are witnessing an unprecedented bull run and soaring to new heights as European governments unlock billions to supercharge their militaries. Stocks in Europe have rallied this year, with several companies in the sector registering double-digit returns. Asian contractors in South Korea and India are also benefiting from the splurge. READ ALSO: 10 Best Performing Defense Stocks So Far in 2025 and 13 Best Defense Stocks to Buy According to Billionaires. However, defense stocks in the US have struggled this year due to concerns about government budget cuts. President Trump has hinted at significantly reducing future military spending if things settle down with China and Russia. The creation of DOGE has also reshaped investors’ views of the industry. Despite a shaky start to 2025, analysts at UBS are optimistic about the sector as they believe the downside is shrinking. Here is what the firm recently stated: “Consensus estimates have moved higher since the election despite the 40% sell-off. The downside potential seems increasingly smaller. We believe that the current environment is markedly different from Sequestration and do not believe a similar outcome is likely.” Citi analyst Jason Gursky, in a note to clients on March 5, also urged investors about this being the right time to buy American defense stocks. While the analyst acknowledged that the world may be moving toward a multi-polar order, he argued that it was not any less dangerous to decrease the need to acquire tools of deterrence. Gursky also stated that as long as the global threat environment remains and the United States maintains its leadership role, regardless of whether it is as a sole superpower or as a power in a multipolar world order, defense spending is expected to remain robust, which would benefit stocks in the sector. With that said, let’s now head over to the list of defense stocks that are declining this week. Please note that the stocks listed are based on one week’s performance. Our analysis does not reflect the prospects of the companies. Their share prices could go high or low in the future, depending on external market conditions, industry-specific challenges, and the company’s capabilities. Additional research and caution are advised before making investment decisions. Why Embraer S.A. (ERJ) Is Declining This Week? An engineer examining a detailed blueprint of an aircraft. For this article, we went through screeners to see how stocks in the aerospace and defense industry performed over the past week (March 24-28). From there, we picked the top 10 defense stocks with the highest percentage decline in share price during this period. All data is as of the close of business on Friday, March 28, 2025. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here). Weekly Decline: -12.22% Embraer S.A. (NYSE:ERJ) is a Brazil-based jet manufacturer that produces aircraft for commercial and executive aviation and defense purposes. Shares fell by 12.22% this week after Wolfe Research downgraded the stock to Peer Perform from Outperform, citing risks associated with recent tariffs and Embraer S.A. (NYSE:ERJ)’s limited upside potential. As a result, it finds itself among the defense stocks that are declining this week. Despite the dip, 2025 has been a stellar year for Embraer S.A. (NYSE:ERJ), with year-to-date gains of over 73% as of the close of business on March 28. The company has received several high-value orders this year, including a $7 billion agreement with Flexjet in February. Overall, ERJ ranks 6th among the defense stocks that are declining this week. While we acknowledge the potential of defense companies, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than ERJ but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock. READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires Disclosure: None. This article is originally published at Insider Monkey.
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