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Boeing To Report As New Crosscurrents Muddle Outlook

Boeing (BA) will report second-quarter results early Wednesday as more 737 Max orders roll in while Covid-19 cases are also resurgent. Boeing stock rose.




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It’s been a turbulent two years for Boeing stock, and the company should post its seventh straight quarter of losses in Q2.

Boeing Earnings Report

Estimates: Analysts polled by FactSet see per-share losses narrowing to 83 cents from $4.79 a year ago, as revenue jumps 40.6% to $16.6 billion. Commercial unit revenue is expected to hit $6.24 billion, as deliveries surged 50% to 75. Defense revenue is seen rising to $6.76 billion.

Results: Check back Wednesday.

A surge in orders, including one from United Airlines (UAL) for 200 planes, has Boeing outlining plans to increase 737 Max output to as many as 42 jets a month in fall 2022, industry sources told Reuters.

Boeing has publicly said it plans to boost production steadily from its current lower production rate to hit 31 jets per month in March 2022.

But new headwinds to Boeing stock have emerged. The highly contagious delta variant of Covid-19 could slow the international travel recovery. And Boeing trimmed 787 production with deliveries seen at less than half its inventory this year. That’s down from an earlier estimate of nearly all its completed planes.

JPMorgan analysts warned in a July 14 note that Boeing could take a charge on its 787 program.


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Boeing Stock

Shares rose nearly 2% to 225.85 on the stock market today. Boeing stock is back above its 200-day line but remains below the 50-day line, according to MarketSmith chart analysis.

Top supplier Spirit AeroSystems (SPR) climbed 2%, and engine supplier General Electric (GE) rose 1.8% ahead of its Q2 report early Tuesday.

Increased competition from rival Airbus (EADSY) is also weighing on Boeing stock. The European aerospace giant was the largest plane maker for the last two years and has ambitious plans to boost the production of its A320 narrow-body jets.

“We also echo concerns that Airbus’ market share gains could be longer lasting if Boeing does not respond with a strategic alternative,” Bank of America analysts wrote in a July 21 note. “Plans to produce 70 A320 family/month in (first quarter 2024) could appear ambitious at first glance but could leave Boeing with 40% market share if the once venerable giant doesn’t respond.”

Follow Gillian Rich on Twitter for aviation news and more.

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