Boeing is slated to report its first-quarter 2022 results before the market open on Wednesday, April 27th.
Latest Results
In the fourth quarter, 2021, Boeing’s net losses more than halved to $4.14 billion, or $7.02 a share, from $8.42 billion, or $14.65 a share, in the year-ago period.
Excluding nonrecurring items, core losses per share came to $7.69, compared with the FactSet per-share loss consensus of 36 cents.
Revenue fell 3.3% to $14.79 billion, while the FactSet consensus was for a rise to $16.54 billion. Commercial aerospace revenue edged up 0.5% to $4.75 billion but was well below the FactSet consensus of $5.58 billion, and defense, space, and security revenue dropped 13.5% to $5.86 billion to miss expectations of $6.83 billion.
Free cash flow swung to a positive $494 million from a negative $4.27 billion, while the FactSet consensus was for a negative $111.6 million.
Boeing Q1 Guidance
As to key drivers of 2022 revenue and cash. Boeing anticipates revenue increase primarily driven by higher commercial airplane deliveries on the 737 and 787 programs. That said, revenue will be impacted by 787 customer considerations and delivering 737 airplanes that were previously remarketed. Boeing forecasts stable revenue in the defense business and solid growth in the services business as the commercial market continues to improve.
Moving to cash, Boeing still expects to generate positive free cash flow in 2022. The key driver remains higher 737 and 787 delivery volume. Boeing still anticipates a significant burn-down of advances balance this year.
From a phasing standpoint, Boeing anticipates the first quarter to be its lowest quarter of the year for revenue, earnings, and cash flow. First-quarter cash flow could look similar to the usage we saw in 1Q 2021 driven by unfavorable receipt timing, excess advance payment burn-down, resource availability due to the Omicron variant and normal seasonality. Free cash flow will improve in the second quarter and will meaningfully accelerate in the back half of the year. Boeing expects 2023 cash flow will be materially higher than 2022.
Here's what to watch in Boeing's upcoming report:
Wall Street expects a year-over-year increase in earnings on higher revenues when Boeing (BA) reports results for the quarter ended March 2022. While this widely-known consensus outlook is important in gauging the company's earnings picture, a powerful factor that could impact its near-term stock price is how the actual results compare to these estimates.
The Boeing Company BA recently reported the delivery figures of its commercial and defense operations for the first quarter of 2022. This reflects an improvement of 23.4% in commercial shipments from the previous year’s tally, while defense shipments indicate an improvement of 5.1% year over year.
Combining both the segments, Boeing’s total deliveries in the fourth quarter were 136 units compared with 119 units delivered in the year-ago period. Strong delivery numbers may boost BA’s top line in the first quarter.
Commercial Deliveries Continue to Remain Strong
Boeing reported the commercial deliveries of 95 airplanes in the first quarter of 2022, which increased from the prior-year tally of 77, primarily driven by solid 737 deliveries.
The shipments of 737 totaled 86 compared with 63 in the year-ago period. Boeing delivered five 767 jets during the quarter on par with the year-ago quarter’s tally. The shipments of the 777 model totaled three compared with six in the previous year’s first quarter. The delivery figure of 747 remained unchanged at one compared with the last year’s figure.
However, the aerospace giant delivered none of its 787 Dreamliner jets in the first quarter of 2022 compared to the two jets it supplied in the prior-year quarter. Production quality issues concerning 787 Dreamliner remain a bottleneck for the company, resulting in a halt of its shipments. This impedes its overall commercial delivery stats to a certain extent.
Tailwinds
The 737 Max fleet continues to witness a northward trend in demand ever since its return to operations after the Federal Aviation Administration nod in November 2020. The significant momentum in demand for 737 jets continues to bolster the commercial delivery numbers of Boeing.
Also, an upswing in air-travel demand due to the ease in domestic and international travel restrictions aided the delivery numbers of BA in the first quarter.
Defense Deliveries Remain Solid
Boeing reported the defense deliveries of 41 airplanes in the first quarter of 2022, which decreased by one jet from the prior-year tally of 42.
The shipments of AH-64 Apache (remanufactured) deliveries remained flat at 15 compared with the year-ago period’s tally, while the delivery of AH-64 Apache (new) stood at seven compared with nine in the last year’s April quarter. The company delivered four CH-47 Chinook (new) jets during the first quarter compared with three jets shipped in the year-ago quarter.
The shipments of F-15 Models included one jet compared with three in the prior-year quarter, whereas the delivery of the KC-46 Tanker increased by two jets from the previous-year figure to reach a total of four in the first quarter of 2022. The delivery of F/A-18 Models and P-8 Models remained flat at four and three, respectively, compared with units delivered in the year-ago period.
Analyst Opinions
According to Zacks, Boeing is expected to post a quarterly loss of $0.26 per share in its upcoming report, which represents a year-over-year change of +83%. Revenues are expected to be $15.68 billion, up 3% from the year-ago quarter.
Jefferies Financial Group set a $270 price target on shares of Boeing in a research report on March 9th.
Cowen reduced their price target on shares of Boeing from $265 to $230 and set an “outperform” rating for the company in a research report on March 7th.
UBS Group set a $290 price target on shares of Boeing in a research report on March 22nd.
Comments