What an­a­lysts ex­pect from Boe­ing Q2

Financial Mirror (Cyprus) - - FRONT PAGE -

When aerospace gi­ant Boe­ing Co. (NYSE: BA) re­ports sec­ond-quar­ter earn­ings be­fore the mar­kets open Wed­nes­day, the com­pany is ex­pected to post a net loss per share of $0.92. That com­pares with earn­ings per share of $1.62 in the sec­ond quar­ter of 2015. Rev­enues are tagged at $24.04 bil­lion, com­pared with year-ago rev­enues of $24.54 bil­lion. The loss is due to last week’s an­nounce­ment of $3.23 per share in charges against three of the com­pany’s air­craft pro­grams: $847 mil­lion ($1.33 per share) for two un­sold 787 Dream­liner test planes that will now be writ­ten down to R&D ex­pense and lower de­ferred pro­duc­tion costs by less than 3%; $814 mil­lion ($1.28 per share) to re­flect lower es­ti­mated to­tal 747-8 freighter pro­duc­tion; and $393 mil­lion ($0.62 per share) for de­vel­op­ment costs on the KC-46A U.S. Air Force tanker pro­gramme.

Boe­ing de­liv­ered 199 com­mer­cial jets in the sec­ond quar­ter of 2016, es­sen­tially flat com­pared with 197 de­liv­er­ies in the same pe­riod last year. This year’s to­tal in­cludes 127 737s, 28 777s, and 38 787 Dream­lin­ers. Sec­ond-quar­ter de­liv­er­ies also in­clude two 747s and four 767s, com­pared with last year’s to­tals of five 747s and four 767s. Boe­ing de­liv­ered a to­tal of 762 com­mer­cial planes in 2015.

Bar­clays an­a­lysts said that the quest for a clean quar­ter con­tin­ues. The bank’s an­a­lysts rate the stock Over­weight with a $155 tar­get price and made this com­ment: “We ex­pected a Q2 charge from BA on the tanker pro­gram de­lays as­so­ci­ated with re­cent hard­ware changes, which frankly we saw tak­ing away the po­ten­tial for the type of clean beat/raise quar­ter that we grew ac­cus­tomed to be­fore the last year and a half.”

The an­a­lysts go on to say that they did not ex­pect the charges to the 747 and 787

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