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

Shares Search
Shares
Index
Commodity
Bonds
Crypto
ETFs
Currency

Instrument

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

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

https://fcloud-my.sharepoint.com/:w:/g/personal/georgy_istigechev_markets_com/EfzJAG_StmBLuvl4w0dQcO0BCX-6um9i0kImFvbu4VNFiw?e=b89Ezg

Monday, 7 October 2024

Indices

Markets drop 50bps Fed cut bets as “soft landing” narrative returns

New Zealand rate cut likely, FOMC and RBA minutes out

Saturday, 5 October 2024

Indices

Week ahead: FOMC minutes out, more cuts likely in New Zealand

Oil price jumps after Biden's comments on possible Israeli strikes on Iran

Friday, 4 October 2024

Indices

Oil price surges after Joe Biden’s comments on possible Israeli plans to attack Iran

US dollar sees continued safe haven flows on Middle East conflict concerns

Thursday, 3 October 2024

Indices

US dollar sees continued safe haven bid on Middle East concerns

Live Chat