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 $190, cut $20, reflects a 39x multiple of projected 2024 EPS. The applied multiple is slightly below BA’s recent historical forward average of 42.5x, merited, in our view, by the ongoing retrenchment that must occur to move past quality control problems with the 737 family. We widen our expected per-share loss in 2023 by $1.94 to $5.23 and we cut our 2024 EPS estimate by $0.53 to $4.86. A Q3 operating loss per share of $3.26 vs. a loss per share of $6.18 is $0.65 wider than the consensus view. On a positive note, order flow is good, as BA racked up 400 net orders in Q3, but 2023 guidance on 737 deliveries was cut to a range of 375-400 in 2023 (prior of 400-450). BA’s long-term prospects remain good, in our opinion, as demand for new aircraft to replace an aging global fleet looks robust. The defense side of the business has 25% of its portfolio in fixed-price contracts that are also near-term headwinds. We think prospects brighten as we get closer to 2025.