Live Chat

Boeing shares rally on better-than-expected earnings amid 737 MAX 9 turmoil

Boeing shares up as earnings beat expectations amid 737 MAX 9 troubles

Boeing shares closed up 5.3% on Wednesday as the aerospace giant reported better-than-expected fourth-quarter earnings.

The earnings announcement, however, was just a portion of the broader narrative. Key discussion points on the Boeing earnings call included the status of the 737 MAX jet, production standards, increased regulatory scrutiny, the trajectory of commercial aerospace's recovery, approvals for new aircraft, and the profitability of Boeing's defense segment.

In Q4 2023, Boeing disclosed a loss of 47 cents per share on $22 billion in revenue, with free cash flow (FCF) reaching $3 billion. These figures beat Wall Street's expectations, which had forecasted a 76-cent loss per share on $21.1 billion in revenue and $2.1 billion in free cash flow, based on Bloomberg data.

This marked a significant improvement from a year ago, when Boeing reported a loss of $1.75 per share on roughly $20 billion in revenue.

The Boeing earnings report was a welcome change from the turmoil the firm saw in January, with the CEOs of United Airlines and Alaska Airlines CEO recently taking turns to blast the aerospace firm in public statements, demanding “real action” to restore its previous reputation for quality.

The Boeing share price closed up 5.29% at $211.04 up on Wednesday, compared to the benchmark S&P 500 index and Nasdaq Composite, which were down by approximately 1.6% and 2.23%, respectively. Boeing stock, which trades on the NYSE under the ticker BA, was up 1.6% in premarket on Thursday.

Choose your points of movement

Сalculate your hypothetical P/L (aggregated cost and charges) if you had opened a trade today.

Market

Currency Search
Currency
Index
Shares
ETFs
Bonds
Crypto
Commodity

Instrument

Search
Clear input
Occidental
Siemens
Morgan Stanley
GSX Techedu
Marston's
Alibaba
Skillz Inc
Macy's
Lemonade
Lululemon
Plug Power
Amazon.com
Verizon
Thermo Fisher
Mondelez
General Motors
LVMH
IAG
Cinemark
PETROCHINA
Royal Bank Canada
Anglo American
F5 Networks
Nikola Corporation
Zoom Video Communications
Air France-KLM
Comcast
UniCredit
The Cheesecake Factory
Barrick Gold
Bayer
Toro
Kuaishou
Gen Digital Inc
Tilray
Xiaomi
SMCI
Wish.com Inc
Adobe
DISNEY
Coinbase Inc
UiPath Inc
T-Mobile
Rio Tinto
Schlumberger
Invesco Mortgage
Hammerson
Volkswagen
Sartorius AG
ROBLOX Corp
ChargePoint Holdings Inc
UPS
Pinterest Inc
Continental
Jumia Technologies
Medtronic
PayPal
Twilio
Freeport McMoRan
UnitedHealth
SIG
Tesla
Lyft
Boeing Co
Annaly Capital
Santander
Teladoc
Li Auto
CrowdStrike Holdings
Deere
Fedex
Naspers
ProSiebenSat.1
Bilibili Inc
Costco
New Oriental
NVIDIA
Iberdrola
Gilead
American Express
Apple
Airbus
GoPro
Chevron
HSBC HK
Two Harbors Investment aration
easyJet
Inditex
BlackBerry
Anheuser-Busch Inbev
Deliveroo Holdings
Hubspot
Applied Materials
GameStop
British American Tobacco
Trade Desk
McDonald's
AMC Entertainment Holdings
Adidas
AIA
Bristol Myers
Novavax
TUI
Fresnillo
Shell plc (LSE)
Nasdaq
Ceconomy
Lithium Americas Corp
Rivian Automotive
Qorvo
MercadoLibre.com
Coca-Cola Co (NYSE)
HDFC Bank
Roku Inc
Infinera
Arista
Total
JnJ
Dave & Buster's
PG&E
ON Semiconductor
Diageo
XPeng Inc
ASML
Vodafone
Airbus Group SE
Campari
Telecom Italia
Glencore plc
HSBC
ZIM Integrated Shipping Services Ltd
Kraft Heinz
Spotify
Aurora Cannabis Inc
Etsy
Goldman Sachs
Norwegian Air Shuttle
Abbott
Snap
Linde PLC
Blackstone
Cellnex
Tencent
Barclays
Virgin Galactic
JP Morgan
Allianz
RTX Corp
Taiwan Semi
Wal-Mart Stores
Intel
DoorDash
Wayfair
SONY
II-VI
Norwegian Cruise Line
BioNTech
Palantir Technologies Inc
CNOOC
Cisco Systems
Electrolux
ALIBABA HK
Robinhood
Vonovia
British American Tobacco
SAP
Ford
Cameco
Peloton Interactive Inc.
Toyota
Amgen
AT&T
Infosys
Starbucks
Lloyds
Qualcomm
Canopy Growth
3D Systems
CarMax
LUCID
Eni
AMD
Target
IBM
FirstRand
Lumentum Holdings
Alphabet (Google)
Workday Inc
ASOS
Conoco Phillips
Moderna Inc
Trump Media & Technology Group
Fuelcell
MerckCo USA
Salesforce.com
Hermes
BASF
AstraZeneca
Christian Dior
Broadcom
Oracle
Vipshop
CCB (Asia)
Nio
Block
Uber
Accenture
Meta (Formerly Facebook)
Berkshire Hathaway
Wells Fargo
Blackrock
Rolls-Royce
Pfizer
Microsoft
Home Depot
Mastercard
Lufthansa
Marriott
AbbVie
China Life
Baidu
Eli Lilly
DeltaAir
Chipotle
BP
General Electric
eBay
Quanta Services
Netflix
Micron
Visa
Golar LNG
ADT
JD.com
American Airlines
Porsche AG
Palo Alto Networks
Teleperformance
Lockheed Martin
Upstart Holdings Inc
Delivery Hero SE
Airbnb Inc
Nel ASA
GoHealth
Shopify
Aptiv PLC
Bank of America
PepsiCo
Philip Morris
Exxon Mobil
Procter & Gamble
Beyond Meat
Snowflake
L'Oreal
Sea
Porsche
Deutsche Bank
Nike
Unilever
CAT
Prosus N.V.
Unity Software
Citigroup
Upwork Inc.
Vir Biotechnology

Account Type

Direction

Quantity

Amount must be equal or higher than

Amount should be less than

Amount should be a multiple of the minimum lots increment

USD Down
$-

Value

$-

Commission

$-

Spread

-

Leverage

-

Conversion Fee

$-

Required Margin

$-

Overnight Swaps

$-
Start Trading

Past performance is not a reliable indicator of future results.

All positions on instruments denominated in a currency that is different from your account currency, will be subject to a conversion fee at the position exit as well.

Boeing CEO Calhoun says “we simply must be better”

Since a malfunction with an emergency door plug on a MAX 9 jet operated by Alaska Airlines on January 5th, Boeing's stock had seen a roughly 20% decrease leading up to Wednesday's trading session. The S&P 500 and Nasdaq Composite saw gains of about 4% and 6% respectively during the same period.

“We must simply be better,” said Boeing CEO Dave Calhoun on the conference call. “Our customers deserve better.”

In response to the incident, Calhoun outlined measures Boeing has implemented to enhance quality, such as increasing oversight on 737 production, engaging a third-party quality consultant, and pausing production for a comprehensive quality review with staff.

Boeing's commercial airplane segment reported an operating profit of $41 million — a modest figure but a positive shift from the billions lost due to the Covid-19 pandemic and the global grounding of the MAX fleet from March 2019 until November 2020.

“Back in black,” wrote Vertical Research Partners analyst Rob Stallard in a Wednesday note shared with Barron’s. Boeing’s overall operating profit of $283 million was “significantly ahead of our estimate”, he added. Stallard has maintained a Hold rating on Boeing stock with a $245 price target.

Boeing delivers 528 planes in 2023, up from 480 in 2022

In the fourth quarter, Boeing delivered 157 aircraft, including 107 MAX jets, an increase from the 152 jets delivered in the same quarter the previous year, which also included 107 MAX planes. The total deliveries for the year amounted to 528 aircraft, with 387 being MAX jets, up from 480 total deliveries, including 374 MAX jets, in 2022.

Wall Street anticipates around 530 jet deliveries for 2024, although Boeing has not provided financial guidance for the year, stepping away from its usual practice of offering forecasts for free cash flow and jet deliveries.

“Suspending guidance makes sense given recent MAX troubles. Increased regulatory oversight in the aftermath of the incident will impact production rates and the approvals of two other versions of the MAX jet—the shorter MAX 7 and the longer MAX 10,” wrote Barron’s reporter Al Root.

Boeing employees continue work building a Boeing 787 jets at its Everett factory

FAA won’t allow MAX production ramp-up until it’s satisfied with Boeing’s quality assurance

The Federal Aviation Administration (FAA) has said it will not authorize an increase in MAX production until it’s satisfied with Boeing's manufacturing and quality assurance processes. Boeing aims to boost MAX production from about 38 units per month to over 50 in the coming years.

Calhoun indicated during the earnings call that the company could not yet say when production rates might increase.

Boeing is currently manufacturing 38 MAX jets per month, a rate Deutsche Bank analyst Scott Deuschle described as "better than some had feared" in a note on Wednesday, maintaining a Buy rating on Boeing stock with a $295 price target.

Boeing blows by 2023 free cash flow estimates, $5.8bn expected in 2024

For 2024, the market expects Boeing to achieve approximately $5.8 billion in FCF, with the company blowing by analyst expectations in 2023 by posting FCF of $4.4 billion — about $900 million higher than anticipated.

Ahead of the report, Boeing's defense segment had been unprofitable in three of the previous four quarters, with fixed-price contracts and rising inflation affecting the profitability of defense contractors. Investors are keen to see evidence of stability in this area, although the defense segment reported a $101 million loss in the fourth quarter.

The options market had predicted a roughly 4% movement in the stock price, up or down, post-earnings. Historically, shares have fluctuated by an average of about 3% following the last four quarterly reports, with three gains and one decline.

When considering shares and indices for trading and price predictions, remember that trading CFDs involves a significant degree of risk and could result in capital loss.

Past performance is not indicative of any future results. This information is provided for informative purposes only and should not be construed to be investment advice.

Latest news

Sunday, 22 December 2024

Indices

Bitcoin ETFs Experience Record Outflows Amid Crypto Market Decline

Thursday, 19 December 2024

Indices

Analyst revises Amazon stock forecast following major 'moonshot' initiative

Thursday, 19 December 2024

Indices

Stock market today: 3 bullish stocks that J.P. Morgan Just Upgraded

Thursday, 19 December 2024

Indices

Bitcoin news today: Jerome Powell Says Fed Won’t Hold Bitcoin

Live Chat