About the EADS Group:
The EADS Group recently changed its name and is now called the Airbus Group. It is in fact the European leader and second world leader in the aeronautical, space and defence industry. As you may have understood, its activities can be divided into three sectors; the combined sector of commercial aviation, military aviation and civil helicopters, plus defence systems and aerospace systems.
Due to its numerous technological innovations and a constant demand on the international level, EADS has generated significant profits over a number of years.
The major competitors of EADS:
The EADS group, despite an inventive strategy based on innovation, is not the only business in this sector and needs to constantly fight to keep its position in the worldwide classification. In fact, a number of competitors are seeking to win parts of the market and it is extremely important that you learn about them. To be able to correctly analyse the EADS share price you will need to take into account both the technical analysis of its share price as well as fundamental events that could influence its movements over the medium or long term. For that reason, studying the competitors and monitoring their major company events is primordial. Here therefore we present a list of the major competitors of EADS on the international level.
- BAE Systems Plc
- Lockheed Martin Corporation
- Northrop Grumman Corporation
- Raytheon Company
- The Boeing Company
- Cobham plc
- Dassault Aviation SA
- Goodrich Corporation
- Saab AB
- General Dynamics Corporation
- Motorola, Inc.
- Thales SA
Depending on the sector concerned, these competitors could each prove to be a major or significant threat to the future of the EADS company.
The major partners of EADS:
The EADS Group has been able to create strategic partnerships with some of its competitors in order to participate in certain projects and gain market parts. Here we offer you the opportunity to learn more about these different partnerships implemented by the group over recent years.
It was associated with Safran in the Ariane 6 programme in 2014.
The Dassault Aviation Group has been a long-time partner of EADS with a share capital in the company that was recently highly diminished.
Finally, it is important of course to cite Airbus as a partner of EADS as this group has now taken total control of this business.
Price analysis for EADS shares:
The EADS share price is included in the calculation of the CAC 40 French stock market index. Various historical charts clearly show a positive growth over the last few years with occasional leaps that are particularly interesting for traders in these shares.
It can therefore be highly beneficial to trade in EADS shares over the short or the long term.
Economic and financial history of the EADS Company:
It is particularly interesting to review the recent history of the EADS Company from the economic and financial points of view. Here therefore is a brief summary of events from recent years that have had an impact on the share price of this group on the stock markets.
In 2007 the group implemented the ‘Vision 2020’ strategy aimed at achieving a better balance between Airbus and other divisions of the group and increasing the services section.
In 2008 the development organisation of A400M was reviewed to simplify it to the maximum.
In 2009 EADS announced a delay of three years for the first delivery of this apparatus that was initially planned for the end of the year. In the same year, Socata was sold together with several Airbus sites.
In 2011, the Power 8 plan was finalised with the achievement of 2.5 billion in savings and the closure of 7,900 jobs.
In 2012, a proposed plan to regroup the fighter planes of EADS and BAE Systems is conceived by the management of both companies. The discussions were not successfully completed due to a premature statement regarding the proposal that was released to the media. The Vision 2000 plan was therefore abandoned.
In 2013 Daimler and Lagardere removed capital from the company. EADS bought back 15% of these shares at this time.
In 2014 EADS changed their name and became Airbus Group which is subdivided into 3 sections; Airbus, Airbus Defence and Space and Airbus Helicopters. This restructuration was accompanied by the closing of a number of jobs. In the same year, Airbus and Safran announced their intention to create a collaboration to compete against the American giant, SpaceX, under the name Airbus Safran Launchers. Gradually the group sold their shares totalling 45.3% in Dassault Aviation.
In 2016, Airbus and Airbus Group announced their merger and Airbus also announced a restructuration with the closing of 1,000 employee positions and the closure of their site at Suresnes.
In 2017 the French government ordered between 160 and 190 helicopters from the Airbus group.
Major stock market data about EADS shares:
To understand the importance of Airbus shares, previously the company known as EADS, it is essential to know a little of its history, but also other more general information that we will relate here to elucidate the company’s position in the French stock market.
- In 2017 the total stock market capital of the Airbus Company (EADS) achieved €54,869.08 million.
- The number of shares issued by the Airbus Company is currently around 772,912,869 in circulation on the stock markets.
- The price of EADS shares (Airbus) is currently quoted in section A of the Euronext Paris stock market in France.
- The Airbus group share price is also included in the composition of the National French stock market index, the CAC 40, and it is therefore one of the 40 French companies with the largest stock market capital.
Shareholdings in the EADS Company are composed of 76.30% floating shares, 11.11% Sogepa, 11.09% GZBV, 4.18% Sepi, and 0.02% under auto-control.
Advantages and strengths of EADS shares as a stock market asset:
If, like many other particular stock market investors, you want to take a long position on the course of EADS shares, you should of course decide which way you are going to trade. The possibility of a long-term uptrend or on the contrary, of a long-term bearish movement is based on the strengths or on the weaknesses of this American company and of its capacity to face the future. So, let’s start by listing EADS’ advantages and strong points which are leaning for a long term upward movement.
First of all, we can of course, underline the fact that the group EADS has a well thought strategy concerning its activities. The group carries out different activities in a variety of fields as we have just mentioned before, which allows it to diversify its sources of income. Thanks to this wide range of activities, the company is more protected against the risk associated with a single sector.
We can also mention as an undeniable strengths EADS’ innovation capacity. Research is in fact paramount to cope with the high competition in the technological sectors and EADS has already shown that it is takes this element seriously in the past. Each year, the American group consecrates a big part of its profits to investing in R&D, which enables it to develop more effective and innovating products and solutions and thus maintain its place among the leaders in the market.
EADS is already the holder of several patents concerning the latest advanced technologies. In addition, it has been able to seduce many customers around the world thanks to its ability to offer products and services that meet the needs of specific companies.
Always among EADS main strengths, we can mention the efforts that it has made concerning the external development of the company. EADS has adopted a strategy of multiple acquisitions in different fields of activities and in various countries. That was particularly the case with the reacquisition of some of its suppliers such as ND, SatCom, GmbH, and SES Astra. The acquisition of its suppliers obviously gives EADS a better control of its costs of production and it also guarantees the supply of products, services and raw materials necessary for its activities.
Of course, the ranking of EADS on the international market is another strength that should be mentioned. The American company is still the world’s leader in the sector of civil aviation, which allows it to have more weight among its customers and partners, but also to get numerous large scale and interesting contracts. It should also be noticed that the subsidiary Eurocopter, which belongs to EADS, is also an international leader in its sector of activity.
As we have just seen, EADS has numerous strengths which are likely to guarantee its future success and the maintenance of its profits in the years to come.
The disadvantages and weaknesses of EADs shares as a stock market asset:
As we have just seen in detail, the advantages of EADS shares and especially the strengths of this American company are enough to reassure investors who are searching for a long term asset to trade. But your strategy can only be efficient if you consider the negative point as well. Here are therefore the elements that could cause a possible decline in the price of this title and the main weaknesses of this company.
First of all, even if we have seen EADS ability to expand internationally, the fact that its production units are located in different countries and territories could be a problem. In fact, the far geographical situation of its different platforms of production give a certain weakness to the general production, sometimes with elevated costs of transportation, which is of course detrimental to the overall profitability of the company
We also know that the foreign exchange market has a significant influence on the evolution of EADS results. In fact, this American company makes its sales in US dollars, the exchange rate of a dollars against the euro could be a limitation. In fact, even if the euro currently lacks competitiveness when compare to the dollar, EADS’s exports towards Europe are less competitive because of those unfavorable exchange rates.
We have also notice that the company’s activities are still weak concerning the American market. There is still a lot of work to be done to build a reputation, which is one of the company’s main challenges when compare to its competition who benefits from the strengths of the US market.
Finally, it is also important to site among the weak points of this asset the recent scandals that have affected this company concerning manufacturing problems detected on its A380 aircraft. This flaw has of course led to a decline in the overall trust of its customers and investors who fear the situation could reproduce in the future.
As you can see, EADS weaknesses are almost as numerous as its advantages, a fact that you should take into account when setting up your future long-term trading strategies.
Hoy to carry out a good technical analysis about the price of EADs shares?
Now that you are aware of EADS advantages and disadvantages, it should be easier for you to carry out your basic analysis of this title. But in order to do so, you also have to take into account the elements that might affect this title in the future. Here is a summary of the opportunities and challenges that EADS could face in the years to come.
Regarding the opportunities that EADS could size or benefit from, we should keep an eye on the following elements:
-First of all, we have noticed that since several years, the market of aeronautics has been experiencing a significant sharp increase in demand. Analysts estimate that this increase could continue for at least twenty years. In fact, we expect this increase to be of around 22% for Europe and more than 34% on Pacific Asia, which should benefit EADS, who is already well represented in those areas.
-In the field of military aviation, EADS could also benefit from a significant increase in budget for the defense of some emerging countries such as China and India. Specialists expect in fact a sharp increase in demand coming from these countries.
-Finally, EADS should also benefit from the increase in oil prices and fuel, by developing devices that will consume less, which will give it an advantage against its main competitors in the eyes of its customers who are constantly searching to save money.
Of course, you should also be aware of some of the challenges that this company might face:
-The overall decrease in demand in the sector of defense spent by OCDE countries which will probably have an impact on EADS demand in the following years.
-On the other hand, the economical crisis that has been affecting Europe in the last years could also have a negative impact in the development of the countries in this zone which could also have an impact in the development of EADS.
-Finally, while EADS is still a leader in several of its main activities, competition is increasingly becoming stronger and the major companies of the sector are fighting a merciless war, which gives additional pressure on the prices.
In conclusion, if you study all these points one by one, you will be able to analyze the course of EADS shares correctly.