Summary
Boeing(NYSE:BA)is scheduled to announce Q3 earnings results before the market opens on next Wednesday, October 26. Its Q3 total deliveries increased 26 units compared with the one in the same period in 2021, Boeing 737 MAX back in the skies over China, and the Settlement related to 737 MAX crashes announced, made its earnings more optimistic.
Boeing(NYSE:BA)is scheduled to announce Q3 earnings results before the market opens on next Wednesday, October 26. Analysts anticipate Boeing’s revenues to reach18.113 billion, and Boeing is expected to post earnings of 0.136 per share.
Overall, Wall Street is optimistic about Boeing stock, with a Buy consensus rating based on21 Buys,3 Holds, and2 Sells. The average price target of $181.8 implies a 50.94% upside potential from current levels.
Latest Results
It reported Q2 revenue of $16.7 billion, GAAP earnings per share of $0.32 and core loss per share (non-GAAP) of -$0.37, driven by lower defense volume and unfavorable performance, partially offset by higher commercial volume. It recorded a positive operating cash flow of $0.1 billion.
Q3 Guidance
Its CEO Dave Calhoun said the company remained on track to achieve positive free cash flow for 2022, and CFO Brian West expected sales in 2022 to top the $62.3B reported in 2021 and grow again in 2023, including expansion at its commercial and defense arms.
3 Things To Watch Before Q3 Earnings Release
1. Boeing’s Q3 Total Deliveries Rose to 148 Units
Boeing’s total deliveries in Q3 were 148 units compared with the 122 units delivered in the year-ago period.
It reported commercial deliveries of 112 airplanes in Q3 2022, which increased from the prior-year tally of 85. This was primarily driven by solid 737 deliveries.
But it reported defense deliveries of 36 airplanes in Q3 2022, which decreased from the prior-year tally of 37.
2. Boeing 737 MAX Back in the Skies Over China After Nearly Four Years
A MIAT Mongolian Airlines flight from Ulaanbaatar landed in Guangzhou, China, the Mongolian airline has the flight scheduled and listed to go again, using the 737 MAX, on October 17 and October 24.
Boeing officials met with China's aviation regulator to review pilot training criteria for its MAX jetliners, as the company gets closer to securing all approvals necessary to resume flights in China, the last major aviation market yet to allow the resumption of the flights.
Chinese airlines still have not flown the plane commercially since two fatal crashes involving the model in 2018 and 2019.
3. Boeing paid $200M to settle SEC charges related to 737 MAX crashes
Boeing will pay $200 million to settle charges over misleading investors after two fatal crashes of 737 MAX jets, the SEC said. The company's former chief executive, Dennis Muilenberg, will pay $1 million as part of the settlement.
"The settlement announced today fully resolves the SEC’s previously disclosed inquiry into matters relating to the 737 MAX accidents," Boeing said in a statement. "The settlement specifies that Boeing does not admit or deny the findings in the SEC’s statement of facts, which concern company statements made in late 2018 and early 2019."
The two crashes in 2018 and 2019 killed all 346 people aboard the flights, spurring a global grounding of the narrowbody jets. The 737 MAX first returned to the air two years ago.
Analyst Opinions
Bloomberg analyst George Ferguson expected Q3 operating profit could climb to $1.4 billion, about 23% above Q3 2021; commercial revenue may reach $6.94 billion on a 4.1% operating margin, excluding $480 million of abnormal production costs; total revenue could be $17.7 billion with Ebit margin of 7.8%, excluding the $480 million of one-off costs; free cash flow may be around $500 million.
Jefferies analyst S. Kahyaoglu expected that the company will post earnings of $0.24 per share for the quarter, down from their prior estimate of $0.40.It offered a “Buy” rating and a $225.00 target price on the stock. The consensus estimate for Boeing’s current full-year earnings is-$1.95 per share.
Barclay analyst offered a “Neutral” rating and a $160.00 target price on the stock. It estimated the company now has 117,787 in storage, most of which have been parked for 12-24 months, and forecasted 15,787 deliveries in H2 2022 before increasing to 60-80 per year in 2023-2025, reflective of a 50% share of widebody replacement demand levels at 3-4% of the installed base.
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