Boeing missed Wall Street’s estimates again. But much less than usual. Stocks rose.
Boeing (Stock ticker: BA) mentioned First quarter loss per share of $1.27 from $17.9 billion in sales, Wednesday morning. Wall Street was looking at a loss per share of $1.07 on sales of $17.6 billion.
For the same period last year, Boeing reported a loss per share of $2.75 on sales of $14 billion.
It is the 14th time in the past 17 quarters that Boeing has missed bottom line estimates. By comparison, the company’s competitor, Airbus (France), has missed estimates in three of the past 16 quarters.
However, Boeing’s current fault isn’t that huge given all the headwinds the company faces. Earnings are still recovering from the twin problems of the 737 MAX grounding and the impact of Covid-19. The airline has also had delivery and quality issues with its 787 Dreamliners.
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Boeing shares were up 3.6% in premarket trading at $209.41. Standard & Poor’s 500 And Dow Jones Industrial Average Both futures contracts are flat.
In the first quarter, the company delivered 130 aircraft overall, slightly better than the 120 Wall Street forecast was and more than the 95 it delivered in the first quarter of 2022.
Commercial aviation sales rose to 6.7 billion US dollars from 4.2 billion US dollars in the first quarter of last year. This commercial sector is not yet generating profit. Operating losses amounted to $615 million.
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Boeing still expects to deliver between 400 and 450 MAX jets in 2023, which means production rates will rise to about 38 per month sometime this year.
Defense revenues also increased year on year, reaching $6.5 billion, compared to $5.5 billion. Operating losses were $212 million, but the results included a $245 million charge for the KC-46A tanker program.
Rob Stallard, an analyst with Vertical Research Partners, didn’t expect to make a profit and predicted more one-off fees than the carrier’s expenses.
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He recommended focusing on cash flow. Free cash flow was negative $800 million in the quarter. Wall Street projected free cash flow in the first quarter of a positive value of approximately $1 billion. But Boeing didn’t change its free cash flow guidance for the full year. The company still expects to generate free cash flow between $3 billion and $5 billion.
Overall, the quarter was largely as expected, which is a relief for investors.
Boeing hosts a conference call 10:30 a.m. ET to discuss the results. Profits, cash flows, production rates and demand for new aircraft orders will be topics for discussion.
Boeing stock is up about 15% over the past 12 months, while the S&P 500 and Dow Jones Industrial Average are down 5% and 1%, respectively. An improved outlook for air travel as the world transitions from Covid is one reason for improving investor sentiment.
Write to Al Root at [email protected]
“Extreme travel lover. Bacon fanatic. Troublemaker. Introvert. Passionate music fanatic.”
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