CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
Our 12-month target of $194, down from $209, reflects a 25x multiple of projected 2025 EPS, below BA’s recent historical forward average, based on what we see as high regulatory risk. We lift our 2024 EPS estimate by $0.41 to $4.01 but cut 2025’s by $0.59 to $7.76. A Q4 operating loss per share of $0.47, vs. a loss per share of $1.75, was $0.32 better than consensus. The FAA is limiting BA, for now, to a delivery rate of 38 units per month for its flagship 737 MAX narrow-body aircraft while BA irons out process and manufacturing deficiencies. We think current consensus EPS estimates for 2024 and 2025 bake in a fairly rapid recovery in commercial aerospace deliveries, yet BA pulled forward guidance, and the Alaska Air incident may induce more caution on the production line. We see a return to profitability in Commercial Aerospace and Defense segments in 2H 2024, with only a slow uptick in volumes. BA has an opportunity to earn its way back to the FAA’s good graces, but solid execution will be key.