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3 days ago
US DOJ Nears Completion of Boeing Plea Agreement, Filing Expected by July 24
By: MT Newswires | July 19, 2024
The US Justice Department has made significant progress in finalizing a plea agreement with Boeing BA, Reuters reported late Thursday, citing the agency.
The report said the DOJ plans to file a factual statement supporting its breach determination with the plea deal. Originally expected to be filed by Friday, the filing is now expected to be completed by July 24.
Boeing had agreed earlier in the month to plead guilty to a criminal fraud conspiracy charge and pay a $243.6 million fine after the Justice Department found it had violated a deferred prosecution agreement from 2021, Reuters reported.
Boeing has not immediately responded to MT Newswires' request for comment.
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1 week ago
Boeing (BA) Q2 Commercial Deliveries Plunge 32% Y/Y, Lag Airbus
By: Zacks Investment Research | July 12, 2024
The Boeing Company BA recently reported the delivery figures of its commercial and defense operations for the second quarter of 2024. It recorded a year-over-year decline of 32.4% and 26.3% in commercial and defense shipments, respectively.
Combining both segments, Boeing’s total deliveries in the second quarter were 120 units compared with 174 in the year-ago period. Such dismal delivery numbers might lead to a decline in BA’s second-quarter top line year over year.
Commercial Deliveries Drop
Boeing reported commercial deliveries of 92 airplanes in the second quarter of 2024, down from the prior-year level of 136, primarily due to lower 737 and 787 deliveries.
The shipments of 737 totaled 70 compared with 103 in the year-ago period. Nine 787 models were shipped compared with 20 in the corresponding period of 2023. Apart from these jets, Boeing delivered six 767 jets during the second quarter compared with eight in the year-earlier quarter.
Only 777 jet deliveries improved year over year from five to seven in the second quarter of 2024.
What Led to Lower Commercial Deliveries?
Boeing’s 737 jet program has been suffering since the beginning of this year. Notably, this jet maker had to slow down the production rate for the 737 aircraft model after it came under increased scrutiny from regulators following the mid-air blowout of a door plug on a 737 MAX 9 jet in January 2024.
This incident also led to subsequent inspections by airlines that revealed some serious quality control issues for some 737 Max 9 jets, making the delivery of these jets more difficult even after the Federal Aviation Administration cleared them to fly again.
Also, the delay in aircraft delivery that Boeing has been facing in China lately, due to a Chinese regulatory review of batteries powering the cockpit voice recorder, must have resulted in the southward trend in 737 deliveries.
Supplier shortages of a few key parts of 787 jets have been hindering the production rate for this aircraft model, which might have led to lower 787 delivery figures in the second quarter.
Boeing Vs. Airbus
A comparative analysis of Boeing’s archrival Airbus SE’s EADSY 2024 commercial aircraft shows that the latter was ahead in terms of delivery numbers. Notably, Airbus delivered 181 commercial aircraft in the second quarter compared with Boeing’s 136 in the same period.
The year-over-year change in deliveries also reflects a similar story. While deliveries for Boeing indicate a decline of 32.6%, the same for EADSY signals a drop of 4.2%.
Defense Deliveries Decline Too
Boeing reported defense deliveries of 28 airplanes in the second quarter of 2024, which decreased from the prior-year level of 38.
The shipments of AH-64 Apache (remanufactured) deliveries were seven compared with the year-ago period’s figure of 16. Three AH-64 Apache (new) were delivered compared with five in the corresponding period of 2023.
BA delivered one CH-47 Chinook (new) jet during the second quarter compared with two in the year-ago quarter.
The delivery of F/A-18 Models came in at three compared with six in the second quarter of 2023. Two P-8 Models were delivered, flat year over year.
However, the delivery of CH-47 Chinook (renewed) jets increased to four from three in the year ago quarter. The shipments of F-15 Models rose to six jets from four in the prior-year quarter. Also, Boeing delivered two KC-46 Tankers compared to none delivered in the second quarter of 2023.
Expectations From Peers
Prominent jet makers that are yet to report their delivery numbers are Textron TXT and Embraer S.A. ERJ.
In the last reported quarter, Embraer delivered 25 jets comprising seven commercial and 18 executive (11 light and seven midsize) jets. The backlog at the end of the first quarter of 2024 was $21.1 billion for Embraer.
The stock boasts an average four-quarter earnings surprise of 73.12%. The Zacks Consensus Estimate for ERJ’s 2024 sales implies an improvement of 20.1% from the prior-year reported figure. Shares of Embraer have risen 98% in the past year.
Textron delivered 36 jets in the last reported quarter, up from 35 in the year-ago quarter. It also delivered 20 commercial turboprops, down from 30 in the first quarter of 2023. The company delivered 18 commercial helicopters in the first quarter of 2024, down from 22 in the year-ago period. At the end of the first quarter of 2024, Textron recorded a backlog of $13.72 billion.
The long-term earnings growth rate for Textron is 10.1%. The Zacks Consensus Estimate for TXT’s 2024 earnings indicates growth of 5.7% from the prior-year reported figure. Textron’s shares have rallied 28% in the past year.
Price Performance
Shares of Boeing have lost 15.5% in the past six months compared with the industry’s decline of 7.5%.
Zacks
Zacks Rank
The company carries a Zacks Rank #4 (Sell) at present.
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2 weeks ago
Boeing rises; agrees to plead guilty to fraud in US 737 MAX probe
By: Reuters | July 8, 2024
** Shares of planemaker Boeing BA up 1% to $186.7 premarket
** BA agrees to plead guilty to criminal fraud conspiracy charge; to pay a fine of $243.6 mln to resolve a U.S. Justice Department investigation into two 737 MAX fatal crashes
** "This is such a long, drawn nightmare for shareholders and there's a ray of optimism that this may be the last of it - the last hurdle that Boeing needs to cross before it gets back," - Art Hogan, chief market strategist at B Riley Wealth
** The two crashes, in Oct 2018 and March 2019, killed 346 people and led to the FAA grounding the MAX fleet for 20 months, which cost Boeing $20 bln
** BA to also spend at least $455 mln over the next three years to boost safety and compliance programs
** Shares of airplane parts supplier Spirit AeroSystems SPR down 0.7%
** Through Friday's close, BA shares have fallen 48.9% since 2018 crash and 29.1% YTD
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1 month ago
Boeing (BA) Wins $212M Deal to Aid F/A-18 E/F & EA-18G Jets
By: Zacks Investment Research | June 20, 2024
The Boeing Company BA recently clinched a contract involving its F/A-18 E/F and EA-18G aircraft. The award has been provided by the Naval Supply Systems Command Weapon Systems Support, Philadelphia, PA.
Details of the Deal
Valued at $212 million, the contract is expected to be completed by December 2028. Per the terms of the deal, Boeing will provide for the repair of 11 various configurations of flight control surfaces used on the F/A-18 E/F and EA-18G jets.
Majority of the work related to this deal will be executed in Jacksonville, FL.
What’s Favoring Boeing?
Of late, military aircraft have been gaining prominence and significant traction globally due to the advancements of new tactical, logistical and other important features, as well as the ongoing conflicts.
To this end, it is imperative to mention that Boeing’s F/A-18 Block III Super Hornet has the ability to perform virtually every mission in the tactical spectrum, including air superiority, day/night strike with precision-guided weapons, fighter escort, close air support, suppression of enemy air defenses, maritime strike, reconnaissance, forward air control and tanker missions.
On the other hand, the EA-18G Growler, a variant of the combat-proven F/A-18F, is the most advanced airborne electronic attack (AEA) platform and the only one in production today. It provides tactical jamming and electronic protection to U.S. military forces and its allies.
Such remarkable features of these jets must have been ushering in solid contract flows for Boeing, involving the production and associated parts repair of these jets. The latest contract win is a testament to that.
What Lies Ahead?
Rising military conflicts, terrorism, border disputes, territory invasions and violations have forced nations to increase their defense spending toward procuring combat-proven aircraft to enhance their aerial security in recent times. This must have prompted the Morder Intelligence firm to project a CAGR of 3.7% for the global fighter aircraft market in the 2024-2029 period.
Such projections indicate immense growth opportunities for prominent combat jet manufacturers like Boeing. Notably, the company’s Defense, Space & Security segment engages in the research, development, production and modification of manned and unmanned military aircraft. BA’s military jet portfolio includes the F-15, P-8, T-7A Red Hawk and C-17 Globemaster III, apart from the F/A-18 and E/A-18G aircraft.
To this end, it is imperative to mention that Boeing expects approximately 30% of the worldwide fleet of military aircraft to be retired and replaced over the next 10 years, thereby driving increased demand for services to maintain aging aircraft and enhance aircraft capability. This, along with the solid growth opportunities offered by the fighter aircraft market, should significantly boost Boeing’s operational results, considering its wide combat jet portfolio.
Opportunities for Peers
Considering the aforementioned discussion, a few other defense contractors that can also be expected to gain substantially on virtue of their strong presence in the fighter aircraft market are discussed below.
Embraer’s ERJ Defense & Security is a prominent player within the aerospace and defense industry of Latin America. Its product portfolio includes the A-29 Super Tucano light attack and advanced trainer and the C-390 Millennium military multi-mission aircraft. In February 2024, Embraer signed a Memorandum of Understanding with Mahindra to provide the Indian Air Force with the C-390 Millennium.
The Zacks Consensus Estimate for ERJ’s 2024 sales indicates an improvement of 20.1% from the 2023 reported figure. Its shares have risen 81.2% in the past year.
Lockheed LMT is one of the pioneers in the combat aircraft space that has been designing and building combat-proven military aircraft for more than 100 years. Its product portfolio comprises some of the most advanced military aircraft like the F-35, C-130J Super Hercules, F-16 Fighting Falcon, F-22 Raptor and a few more.
LMT boasts a long-term earnings growth rate of 4.1%. The Zacks Consensus Estimate for 2024 sales indicates an improvement of 3.2% from the 2023 reported figure.
Airbus Group’s EADSY military aircraft consists of the A400M, the C295 tactical transporter, the new-generation A330 Multi Role Tanker Transport and the Eurofighter, the most advanced swing-role fighter ever conceived. For more than 40 years, Airbus has also been providing its customers with an extended portfolio of military aircraft services, ranging from the training of Flight and Ground Crews to live firing exercises anywhere around the world.
EADSY boasts a long-term earnings growth rate of 17.9%. The Zacks Consensus Estimate for 2024 sales implies growth of 8.2% from the 2023 reported figure.
Price Performance
In the past six months, shares of BA have lost 33.2% compared with the industry’s 9.4% decline.
Zacks
Zacks Rank
Boeing currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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1 month ago
Boeing Informs Suppliers About Three Month Delay in 737 Production Goal
By: MT Newswires | June 17, 2024
Boeing BA has reportedly informed its suppliers of a three-month delay in reaching a key production milestone for its 737 jets, Reuters reported, citing two industry sources.
According to the sources, the revised schedule now targets a production rate of 42 jets per month by September instead of June. Boeing expects a gradual increase in output, aiming for 47 jets per month by March 2025 and 52 jets per month by September 2025.
Boeing's decision to delay the production milestone suggests ongoing supply chain constraints, the report said.
Boeing did not immediately respond to requests for comment from MT Newswires.
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2 months ago
Saudia turns to Airbus, Boeing wide-body jets amid single-aisle shortage
By: Reuters | June 6, 2024
Saudia Group is in talks with Airbus AIR and Boeing BA over ordering wide-body jets to increase its capacity as planemakers face constraints in production slots of narrow-body aircraft, a spokesperson for the group told Reuters.
The state-owned group, which owns Saudia Airlines and budget carrier Flyadeal, last month ordered 105 narrow-body Airbus planes but had a requirement for 180, said Saudia Group General Manager, Communications and Media Affairs, Abdullah Alshahrani.
Air travel is surging post pandemic and demand for planes is outstripping production as supply chains struggle to ramp up at the same pace. Airbus in January said it is sold out until the end of the decade for single-aisle jets.
A lack of production slots at Airbus, especially for the A320, forced the group to look at wide-body jets, Alshahrani said in an interview on Thursday on the sidelines of the CAPA India aviation conference in New Delhi.
Alshahrani said the group had been "lucky" to get the 105-plane order with Airbus but needed more, adding that Saudia is looking at the Boeing 787 and Airbus A330.
The number of wide-body jets, which will serve both Saudia Airlines and Flyadeal, is under discussion but Saudia Group will place an order this year, he added.
Flyadeal's CEO told Reuters earlier this week that it is studying a possible order for between 10 and 20 wide-body jets.
Saudi Arabia is investing billions of dollars to diversify its economy away from fossil fuel and has an ambitious aviation plan, with new airlines, jet orders and potentially a huge international airport as it takes on regional rival and current Gulf travel hub, the UAE.
The kingdom is also trying to get China's COMAC to set up a local production facility as the Chinese planemaker steps up efforts to sell overseas and break into a passenger jet market dominated by Airbus and Boeing.
Alshahrani said Saudia Group plans to visit COMAC's China facility in September to test the jets so they can be considered in future, but it was "not the time" to place an order.
COMAC's planes fly almost exclusively within China and it is yet to receive benchmark certifications from the United States or the European Union.
Saudia Group flies to 100 destinations and plans to increase this to 150 by the end of the decade as it takes deliveries of 200 new planes, including the Airbus A321XLRs.
India is an important growth market for Saudia Group, which plans to regain share lost to rivals with more direct flights, new destinations and improved plane cabins.
Last year Saudi received 1.5 million visitors from India and Alshahrani said they want to grow this to 7.5 million by the end of the decade.
He said they met with Air India this week to talk about partnerships including a codeshare agreement.
"We want to work with Indian carriers closely on any type of cooperation to increase and offer good options to the Indian and Saudi passengers," he said.
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2 months ago
Boeing Had A Wild Weekend. The Stock Is Up
By: Barron's | June 3, 2024
Boeing investors have a lot to consider as a new week of trading begins. The stock is rising as a report of a potential new order offsets a flurry of negative developments during the weekend.
Shares were up 2.9% in early trading at $182.81, while the S&P 500 and Nasdaq Composite were up 0.4% and 0.8%, respectively.
A start in positive territory was far from certain. For starters, Boeing's first crewed launch of its reusable space capsule Starliner was delayed again. A Saturday launch attempt was scrubbed with less than four minutes left on the countdown because of a rocket computer issue. The first launch attempt, on May 6, was delayed by a separate rocket problem.
The rocket that carries the Starliner into space is supplied by United Launch Alliance, a 50/50 joint venture between Lockheed Martin and Boeing.
Along with the Starliner disappointment, the Guardian and The Seattle Times published more whistle-blower accounts about concerns with Boeing's production quality.
Production quality has been in focus since the Jan. 5 emergency-door- plug blowout of a 737 MAX 9 jet operated by Alaska Air. The incident, traced back to missing bolts, has resulted in more regulatory oversight, slower production, and lower earnings and cash flow estimates from Wall Street.
Coming into Monday trading, Boeing stock was off about 29% since the door-plug incident, which left a hole in the side of the jet at thousands of feet above the ground.
There was more bad news for investors. The new 777x plane, which is due to enter service in 2025, might be delayed until 2026, according to comments from Emirates CEO Tim Clark. Emirates has ordered more than 250 777x jets.
The good news on Monday came in the form of a potential new order. Bloomberg reported that Qatar Airways was close to an order for the 777x.
Qatar Airways flies a mix of Boeing and Airbus twin-aisle jets. The 777x is a twin-aisle jet. Its single-aisle fleet is all Airbus. Boeing referred Barron's to Qatar Airways for comment. The airline didn't immediately respond to a request for comment.
Wall Street was weighing in too. Baird analyst Peter Arment cut his target for the stock price to $240 from $300 a share but continues to rate the shares at Buy.
"We remain constructive on the Boeing stock for the long term as the brutal first half 2024 performance reflects peak in sentiment negativity coupled with [a] large mix of retail investors selling on the headline risks," wrote Arment.
Through early trading Monday, Boeing shares are still down about 30% year to date. He believes the second half of the year will be better for shares.
Overall, 60% of analysts covering Boeing stock rate shares Buy, while the average Buy-rating ratio for shares in the S&P 500 is about 55%. The average analyst price target for Boeing stock is about $213 a share.
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2 months ago
Boeing Will Need Years for Turnaround, Emirates’ Clark Predicts
Story by Leen Al-Rashdan and Guy Johnson
(Bloomberg) -- Boeing Co. will need years to emerge from its current crisis, the biggest buyer of the US manufacturer’s widebody aircraft predicted.
“For me, this will be a five-year hiatus starting from now,” Emirates President Tim Clark said in an interview in Dubai. “I don’t think they will recapture their production line on all aircraft types.”
As a result of the manufacturing issues and delays on new widebody aircraft at the planemaker, Emirates is putting more of its Boeing 777 aircraft through an extensive retrofit program, Clark said. That’s raising the cost of that program to about $3.5 billion from previously $2 billion, he said.
Clark is an influential voice in the aviation industry because his company buys the biggest Boeing and Airbus SE aircraft in greater numbers than any other carrier. The executive has publicly used his status to point out performance issues at the two manufacturers, the only builders of large planes used on global routes.
Boeing’s 777-9 model, of which Emirates has ordered more than 100 units, is about five years late, and Clark said he has “no visibility” on a new time frame, most recently scheduled for mid 2025.
The carrier is “extremely exasperated” with Boeing as delays are obstructing the airline’s growth plans, Clark said, adding that he plans to meet Stephanie Pope, the new head of Boeing’s commercial aircraft subsidiary, in Dubai in coming days.
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2 months ago
Boeing Stock Shrugs Off Dire Warning
By: Schaeffer's Investment Research | May 24, 2024
• Boeing's CFO warned of negative free cash flow in the second quarter
• The stock is down nearly 34% in 2024
Boeing Co (NYSE:BA) stock is up 0.6% to trade at $173.15 this morning, looking to bounce back from yesterday's 7.6% drop despite a dire warning. CFO Brian West said that free cash flow is likely to be negative in the second quarter, as troubles from multiple manufacturing mishaps persist.
Prior to yesterday's gap, BA was rallying headfirst into its declining 80-day moving average. The equity is pacing for a nearly 7% loss this week, and it sits nearly 34% lower in 2024.
Analyst sentiment doesn't match price action, either. Of the 22 covering brokerages, 15 still rate BA a "buy" or better. This leaves the stock vulnerable to a round of bear notes.
Options bears are taking their cues. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), Boeing stock's 50-day put/call volume ratio of 1.49 ranks higher than 980% of readings from the past 12 months. This means options traders' have favored long puts over the last 10 weeks. Echoing this, the equity's Schaeffer's put/call open interest ratio (SOIR) of 0.60 ranks in the low 2nd percentile of readings from the last 12 months.
It's also worth noting the stock's Schaeffer's Volatility Scorecard (SVS) stands at an 99 out of 100. This means BA exceeded option traders' volatility expectations during the last 12 months.
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2 months ago
Boeing Says Cash Flow Is Worse Than It Thought
By: Dow Jones Newswires | May 23, 2024
Boeing said it would burn billions of dollars more than expected in the coming months and likely won't generate cash for the full year, signaling the jet maker is struggling to contain the financial fallout from cascading production and supply-chain issues.
A month after announcing a nearly $4 billion hit in the year's first quarter, finance chief Brian West warned investors Thursday that the company is on track for a similar or bigger cash hole this quarter.
Boeing shares fell more than 7% in Thursday trading. The stock has lost roughly a third of its value so far this year, erasing more than $50 billion in market capitalization.
West also told investors that Boeing is unlikely to generate cash for the full year as the company deals with slowing production of its jets.
It is a bleaker picture from a month ago when the company said it expected to narrow its cash burn this quarter, and end 2024 cash-flow positive.
"We have frustrated and disappointed our customers because of some of the production and supply-chain issues we are up against," West said at an industrials and transportation conference in New York. He added that Boeing should begin generating cash in the second half of the year.
Boeing is grappling with slower production of its bestselling 737 MAX jets as it roots out quality problems after January's near-catastrophe on an Alaska Airlines flight. The troubles have drawn increased regulatory scrutiny and triggered a management shake-up.
West said Thursday that 737 deliveries will remain well below the company's goal of 38 jets-per-month through June. Boeing delivered 67 of the planes in the first three months of the year and is on track for about the same number in the second quarter, he said. He said production will pick up later in the year.
"We can't push the factory too hard or the system too hard because the payoff, if we do this right, is going to be big beyond 2025," West said.
Adding to the woes have been a string of unrelated issues that are both slowing production and preventing Boeing from delivering planes it has already built.
Problems range from parts shortages to the recent revelation, disclosed by Boeing, that its employees may have skipped some inspections on 787 Dreamliners and falsified inspection records. Boeing as of this week hadn't produced a new 787 this month, according to analysts. Dozens of the planes remain parked outside the jet maker's North Charleston, S.C., plant awaiting delivery.
The company's monthly jet deliveries in April hit their lowest level since the onset of the pandemic, when the decline in air travel brought jet production to a near standstill.
The latest issue: Boeing said this week that China has temporarily stopped taking delivery of MAX 8 jets so it can review batteries included in the 25-hour cockpit voice recorder aboard the planes. U.S. and Chinese regulators are in talks about the matter and Boeing said Wednesday that it would defer to those agencies.
The company said the Federal Aviation Administration and European regulators have signed off on the system, which meets requirements of some non-U.S. air-safety agencies that voice recorders capture 25 hours of audio instead of two.
Boeing had 85 of the China-bound MAX jets in inventory at the end of 2023 and delivered 22 so far this year. Deliveries resumed this year after a yearslong freeze by Beijing following two fatal crashes of the 737 MAX 8.
The company last month tapped debt markets to raise $10 billion as investors fret over the company's liquidity. It ended March with $7.5 billion of cash and investments, less than half what it had at the start of the year.
In April, Moody's Investors Service downgraded its rating on Boeing's unsecured debt by one notch to Baa3, the lowest investment-grade level. Moody's expects that cash-flow pressures will persist through 2026.
Boeing has said it is in talks to acquire Spirit AeroSystems, which makes fuselages for the 737, to help improve its quality.
West said the company is optimistic it can reach a deal with Spirit by the end of June. The talks have dragged out amid negotiations with rival Airbus about control of Spirit factories that produce parts for Airbus jets.
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2 months ago
Boeing deliveries to China delayed by state regulator review
By: Reuters | May 22, 2024
Boeing's BA plane deliveries to China have been delayed in recent weeks due to a Chinese regulatory review of batteries related to the cockpit voice recorder, a source familiar with the matter told Reuters.
The U.S. planemaker said in a statement it is working with Chinese customers on the timing of their deliveries pending a review by the Civil Aviation Administration of China of batteries contained within the 25-hour cockpit voice recorder.
In a year-end 2023 filing, Boeing said it had approximately 140 737-8 aircraft in inventory, including 85 aircraft for customers in China. Boeing has delivered 22 aircraft to China in 2024 through the end of April.
Boeing said the Federal Aviation Administration has certified this system, which stores more data than past cockpit voice recorders.
China in March Boeing gave permission last month to resume deliveries of its 737 MAX 8 to local customers, ending an import freeze on the U.S. planemaker's most profitable jets which came shortly after its first delivery in 2019.
China was the first country to ground MAX jets after two accidents in 2018 and 2019 that killed nearly 350 people.
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2 months ago
Saudi Arabia snubbed Boeing with a huge Airbus order, the biggest aircraft deal in the country's history
By: Business Insider | May 21, 2024
• The Saudia Group announced an order for 105 Airbus jets on Monday.
• It comes as a reported Boeing order from Riyadh Air, also government-owned, has yet to materialize.
• Its CEO blamed negative media coverage as to why he hasn't yet announced the deal.
The Saudia Group announced Monday a huge Airbus order in a blow to Boeing.
105 narrowbody jets — a mix of A320neo and A321neo models — will be distributed between the flag carrier Saudia and its subsidiary low-cost-carrier flyadeal.
In a press release, the Saudia Group called it "the largest aircraft deal in Saudi aviation history."
Saudia is owned by the country's government, and the airline's chairman is also the transport minister.
The deal suggests Boeing's reputation is worsening around the world because the planemaker has formerly won big orders from the kingdom.
Last March, Saudi Arabia founded a second national airline, Riyadh Air, which placed an order for up to 72 Boeing 787 Dreamliners.
Boeing also looked set to win the deal for Riyadh Air's narrowbody jets. Shortly before last November's Dubai Air Show, Bloomberg reported that Riyadh Air was eyeing up an order for as many as 100 Boeing 737 Max jets.
However, that order has yet to materialize.
Tony Douglas, the Riyadh Air CEO, blamed negative media coverage during an interview with Reuters on Monday.
"What happened was the media three weeks later spent every hour of every day writing negative stories about commercial aviation," he said.
Douglas told Reuters he wasn't referring to January's blowout, in which an Alaska Airlines Boeing 737 Max lost a door plug in midair.
"The last thing I want to do is present my good news and have it in a context of things that are going on elsewhere, which are not quite as positive," he added. "Be it Airbus can't deliver on time [or] Boeing is having some technical problem."
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2 months ago
Did Buffett Scoop Up Shares of Boeing Without Us Knowing?
By: Wall St. | May 17, 2024
Boeing’s appeal to Warren Buffett is bolstered by its strong brand, quasi-monopoly status, and significant defense operations, which benefit from ongoing global conflicts and defense spending. With substantial cash reserves, Buffett may consider investing in Boeing (NYSE: BA) soon, especially as the company’s stock could stabilize or become more attractive due to potential whistleblower testimonies. The next few months are critical for assessing Boeing’s market position and potential investment opportunities.
Transcript:
Yeah. Something else people sometimes forget is that Boeing deep down is a defense company.
Right.
And there are enough wars or, you know, warlike situations in the world. So if you’re a defense contractor, the next five years could look pretty good for you.
Oh, absolutely. And, you know, there’s a constant flow of money from around the world, and you’ve seen the money that’s gone, you know, I mean, ostensibly the money for Ukraine, and it ostensibly is going right back to American arms manufacturers and defense contractors. So, yeah, absolutely.
Yeah, and as NATO moves weapons over, a lot of that weaponry has been sold to the NATO countries by U.S. manufacturers.
Right. That part of Boeing should continue to do pretty well. So let’s do this. I think if Buffett’s going to do something with Boeing, it’s probably going to be in the next few months. He’s going to wait maybe a little while, but I don’t think things are going to get worse at Boeing. They’re going to go sideways. So if he’s going to do something, I think he’ll probably do it soon. So let’s come back to this in a couple months. Let’s see where Boeing is trading. And maybe Buffett will surprise us and he will have already started to move in.
Right. Well, and we’ll see if there’s more whistleblower testimony that maybe is the final punch in the face to knock the shares down to a point where he’s willing to go in.
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2 months ago
The Boeing Company (BA) is Attracting Investor Attention
By: Zacks Investment Research | May 10, 2024
Boeing BA has recently been on Zacks.com's list of the most searched stocks. Therefore, you might want to consider some of the key factors that could influence the stock's performance in the near future.
Shares of this airplane builder have returned +4.6% over the past month versus the Zacks S&P 500 composite's +0.2% change. The Zacks Aerospace - Defense industry, to which Boeing belongs, has gained 3.4% over this period. Now the key question is: Where could the stock be headed in the near term?
Although media reports or rumors about a significant change in a company's business prospects usually cause its stock to trend and lead to an immediate price change, there are always certain fundamental factors that ultimately drive the buy-and-hold decision.
Revisions to Earnings Estimates
Rather than focusing on anything else, we at Zacks prioritize evaluating the change in a company's earnings projection. This is because we believe the fair value for its stock is determined by the present value of its future stream of earnings.
We essentially look at how sell-side analysts covering the stock are revising their earnings estimates to reflect the impact of the latest business trends. And if earnings estimates go up for a company, the fair value for its stock goes up. A higher fair value than the current market price drives investors' interest in buying the stock, leading to its price moving higher. This is why empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For the current quarter, Boeing is expected to post a loss of $0.51 per share, indicating a change of +37.8% from the year-ago quarter. The Zacks Consensus Estimate has changed -2516.3% over the last 30 days.
For the current fiscal year, the consensus earnings estimate of -$0.24 points to a change of +95.9% from the prior year. Over the last 30 days, this estimate has changed -159.1%.
For the next fiscal year, the consensus earnings estimate of $5.60 indicates a change of +2,434.9% from what Boeing is expected to report a year ago. Over the past month, the estimate has changed -8.5%.
With an impressive externally audited track record, our proprietary stock rating tool -- the Zacks Rank -- is a more conclusive indicator of a stock's near-term price performance, as it effectively harnesses the power of earnings estimate revisions. The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #4 (Sell) for Boeing.
The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:
12 Month EPS
Revenue Growth Forecast
Even though a company's earnings growth is arguably the best indicator of its financial health, nothing much happens if it cannot raise its revenues. It's almost impossible for a company to grow its earnings without growing its revenue for long periods. Therefore, knowing a company's potential revenue growth is crucial.
In the case of Boeing, the consensus sales estimate of $19.47 billion for the current quarter points to a year-over-year change of -1.4%. The $81.36 billion and $95.58 billion estimates for the current and next fiscal years indicate changes of +4.6% and +17.5%, respectively.
Last Reported Results and Surprise History
Boeing reported revenues of $16.57 billion in the last reported quarter, representing a year-over-year change of -7.5%. EPS of -$1.13 for the same period compares with -$1.27 a year ago.
Compared to the Zacks Consensus Estimate of $17.69 billion, the reported revenues represent a surprise of -6.34%. The EPS surprise was +20.98%.
Over the last four quarters, Boeing surpassed consensus EPS estimates three times. The company topped consensus revenue estimates two times over this period.
Valuation
No investment decision can be efficient without considering a stock's valuation. Whether a stock's current price rightly reflects the intrinsic value of the underlying business and the company's growth prospects is an essential determinant of its future price performance.
Comparing the current value of a company's valuation multiples, such as its price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), to its own historical values helps ascertain whether its stock is fairly valued, overvalued, or undervalued, whereas comparing the company relative to its peers on these parameters gives a good sense of how reasonable its stock price is.
As part of the Zacks Style Scores system, the Zacks Value Style Score (which evaluates both traditional and unconventional valuation metrics) organizes stocks into five groups ranging from A to F (A is better than B; B is better than C; and so on), making it helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.
Conclusion
The facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about Boeing. However, its Zacks Rank #4 does suggest that it may underperform the broader market in the near term.
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Jetmek_03052
2 months ago
Absolutely. My brother was a check airman for Continental before he retired. He would give Captains proficiency checks and evaluate First Officers for Captain upgrades. In the US that is. He said in his last years, he thought pilot basic airmanship was deteriorating at a rapid rate. It was due to the automation of the flight deck. Everything is figured out for pilots these days, they don't have to do much other than sit in the seat. Auro throttle, Auto Braking, Auto pressurization. EVERYTHING is done for them. And everything is fine until it breaks. The crew is supposed to be able to fly the aircraft without all that fancy "auto" stuff. They learn how to, but things so very rarely break, they forget. So in a true emergency, they lose that split-second decision-making edge. My brother said that many of the pilots he checked would choose to cancel flights, rather than go with an aircraft that a piece of equipment out - even if the MEL (Minimum Equipment List) said they could safely depart without it.
The Asian pilot crews are the worst ones. There is almost no CRM (Crew resource management). The captain is considered GOD-like and what he says goes. Most Asian first officers would sit on their hands and watch the captain corkscrew the aircraft into the ground, rather than raise some sort of alarm!
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