We'll know a lot about what investors think of Motley Fool Stock Advisor pick Embraer (NYSE:ERJ) come April. That's when longtime leader Mauircio Botelho will set aside his role as president and CEO to become full-time chairman.

Fools shouldn't worry. Botelho's successor, Frederico Curado, is an experienced executive who has led the airline division for the last eight years. That means he's at least partially responsible for the E190 and E195 regional jets that that have reshapedJetBlue's (NASDAQ:JBLU) fleet and which should enter service for US Airways (NYSE:LCC) within the next two years.

Meanwhile, competition appears thin. Take Bombardier, for example. The Canadian transportation giant had planned a 100-seat regional jet to do battle with the 190, but then scrapped the design. That all changed in November, when the firm said it may introduce a stretch version of its C-900 jet. But that would be stretching a plane that's already been stretched. No wonder a Fool on our discussion boards called it a "flying cigar."

Others say beleagueredAirbus and Boeing (NYSE:BA) still don't take Embraer all that seriously. Consider this pitch from Motley Fool CAPS player yonnr2000:

"I have a distant relative who is an executive at Boeing. I told him that I just bought some shares of [Embraer] and I was concerned about competition. ... He told me that [Embraer] was an excellent pick and that the market for small jets was a totally different market than the larger jets that Boeing makes, and that Boeing has no intention of entering the smaller market."

Maybe that's why Embraer sees big gains in aircraft deliveries in the coming years. Management said in November that it would deliver 160 planes in 2007 and 195 in 2008. If true, that would equal 20% annual growth over the next two years.

What's the case for turbulence?
To be fair, some of that growth would come from the lower-priced executive jet business. Embraer's new Phenom 100 and Phenom 300 aircraft have earned fans from air taxi services such as Magnum Jet.

That won't mean much for revenue in 2007 or even 2008. But, over the long haul, executive jets are expected to be a huge business. Researcher Forecast International, which independently covers the aircraft industry, says that jets such as the Phenom 100 will create a $15 billion market within a decade.

Embraer's stock rates four stars out of five in Motley Fool CAPS. There are just five "underperform" ratings, and only one of those players left a comment. "[Embraer] will require time to catch up with the likes of Cessna and Boeing in their respective markets," writes techman37.

We know from observation and earlier comments among CAPS bulls that the reference to Boeing may not be quite right. But it is true that Embraer gets a small but growing slice of its revenue from executive jets. Textron (NYSE:TXT), which operates Cessna, and General Dynamics (NYSE:GD), which operates Gulfstream, are much bigger players. And Eclipse and Baby BreakerAdam Aircraft are targeting the same customers as Embraer.

Life vests on board
But I'd always rather invest in a growing firm in a massively growing market, especially when that growth isn't accounted for in the valuation. That seems to be what we have with Embraer.

My back-of-the-napkin math says the stock is worth at least $51 a share. How so? Start with owner earnings; Embraer booked $415.2 million in cash earnings over the trailing 12 months. Now, assume that total grows 14% annually over the next five years (equal to Embraer's most conservative delivery growth estimate), 7% during years 6 to 10, and 3% thereafter (the rate of inflation). Then, discount those cash flows by 11%. That's $51 a share.

Fool's final word
Even without much tailwind, Embraer managed significant business gains during 2006. The stock didn't follow and underperformed the broader market. That happens to every firm from time to time. And, sometimes, it happens twice in row -- or even three or four times consecutively.

But that shouldn't be Embraer. A still-ailing airline industry needs to update to its fleets. And air taxi services are just beginning to take off. Unlike its competitors, it has answers for both and should enjoy a steady ascent as a result. Happy 2007.

Check out the other companies featured in "The Motley Fool's 2006 in Review and 2007 Preview" special.

Embraer is one of dozens of winners David and Tom Gardner have picked for Motley Fool Stock Advisor subscribers. They're beating the market by nearly 40% as a result. Get a close-up look at the portfolio with a30-day free pass.

Fool contributor Tim Beyers , ranked 1,013 out of 17,523 in Motley Fool CAPS , has yet to fly in an E190 jet, but he's sure he would enjoy the experience. Tim didn't own shares in any of the companies mentioned in this story at the time of publication. Get the skinny on all of Tim's stock holdings by checking his Fool profile . JetBlue is also a Stock Advisor recommendation. The Motley Fool'sdisclosure policyadvises you to invest regularly. That's the only sure way to get rich.