Boeing

Boeing (BA) is facing an investigation that will determine if the company failed to ensure that its completed products conformed to their approved design and were in safe operating condition, the Federal Aviation Administration said Thursday. The investigation follows the Jan. 5 incident where a door plug fell off from 737-9 Max Alaska Air passenger jet shortly after takeoff. “Boeing’s manufacturing practices need to comply with the high safety standards they’re legally accountable to meet,” the FAA in an update. The regulator has grounded the 737-9 Max planes and said the timeline for their return would be determined based on safety of the public.

Boeing had burned down its initial $8.3 billion in customer concessions for the original 737 MAX grounding to $1.5 billion by the end of 3Q. Analysts estimates for the MAX 9 grounding range from around $50 million if it stretches through next week to $150 million through January. More seriously, cash flow expectations are also coming down from the 2024 consensus around $6 billion ahead of earnings on Jan. 31. For now, the trims are small, but concerns about a potential slowdown in delivery and production rates have some caution that this could expand to as much as $2 billion.

Boeing (BA) said Tuesday it delivered 67 aircraft in December, up from 56 the previous month, but down from 69 a year earlier. The plane maker said it booked 371 orders last month, up from 114 orders in November and 250 in December 2022, according to data on its website.

Plane maker Boeing’s financial repercussions following an incident involving one of its jets on an Alaska Airlines flight are likely to be relatively contained based on available evidence, say Scott Deuschle and Megan Makini, analysts at Deutsche Bank, in a research note. “Further delays to the MAX-7 certification appears to be the highest probability negative repercussion at this point, though the transparency of this risk had already been rising,” the analysts say, based on information available through 11:45 p.m on Sunday. The FAA ordered a temporary grounding and immediate inspections of dozens of Boeing 737 MAX jets after one of the planes made an emergency landing when a section of the aircraft ripped away in midair. Boeing falls 6.5% to $232.78.

Boeing (BA) 737 Max groundings by the Federal Aviation Administration after the Alaska Air (ALK) accident is a “worrisome” start to the new year, BofA Securities said in a note. Analysts, including Ronald J. Epstein, said that while they see the stock to be weak on the news, they do not expect the issue to have a material impact on their 2024 financial forecast. “Boeing is one of two players in a global duopoly for commercial aircraft which are in short supply, and we believe has been making steady if not slow progress addressing the some of the internal shortfalls that led to its current situation,” the analysts said. The incident closely follows Boeing’s call to airlines to check for loose bolts on 737 MAX rudder systems as well as the company’s request to the FAA for an exemption to safety standards related to engine inlets and anti-ice systems, the

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 $238, cut by $37, reflects a 27x multiple on our revised 2025 EPS estimate, adjusted from our prior 30x, on higher perceived risk. We cut our 2024 EPS view by $0.81 to $4.10 and 2025’s by $0.35 to $8.80. Shares are down 6% following news of a Boeing 737 MAX-9 aircraft, flown by Alaska Airlines (ALK 38 ***), that had a plug-type door blow out in-flight on Friday. The FAA has issued an emergency order, grounding all Max-9’s for further evaluation. On the one hand, BA has 4,526 of its nearly 6,000 commercial aircraft unit orders (about 75%) comprised of 737 MAX planes. On the other hand, the 737 MAX-9 with plug-type doors only affected 171 delivered units, and we think the lion’s

By Steve Gelsi and Bill Peters ‘Due to the duopoly nature of the industry, we do not see this impacting orders for any of the 737 Max variants,’ BofA analysts say Alaska Airlines, United Airlines and Turkish Airlines have all grounded their Boeing 737 Max 9 airplanes after part of one such jet tore away during an Alaska Airlines flight on Friday. But despite the potential safety risks for travelers and further damage to Boeing’s (BA) reputation, some Wall Street analysts, for now, have downplayed the financial impact for the jet maker. In part, they pointed to the company’s status as one of two major players in aircraft production – the other being Airbus (EADSY). They also cited a tighter supply of available aircraft and limited near-term impact, at least while investigators try to figure out the cause of the incident. Those airlines and others took the action over the

By Jon Sindreu Boeing’s 737 MAX model just doesn’t seem able to outfly bad publicity. Even if the latest problem is just with one specific plane, its manufacturers will pay the price of greater scrutiny. Early Monday, futures markets pointed to an 8% fall in Boeing’s share price as investors tried to assess the potential damage inflicted by a door plug that blew out of a jet flown by Alaska Airlines on Friday evening. The Federal Aviation Administration grounded planes Saturday and ordered airlines to conduct inspections. The MAX has become one of the most infamous jet models in the history of commercial aviation. Most of the planes were grounded for nearly two years after 2019 following two deadly crashes. Since the ban on flying them was lifted, a raft of manufacturing glitches have delayed Boeing’s plans to increase production. Just this past December, the company warned about potential loose

Alaska Air announced Friday it has grounded its fleet of 65 Boeing 737 MAX-9 jets after a plane lost a section of its fuselage midair. The Friday night incident should generate a market response on Monday when Boeing stock opens for trading, considering investors’ long, complicated history with the MAX. Flight 1282 took off from Portland, Ore., at about 8 p.m. on Jan. 5, lost a window, and was able to return safely to the Portland airport, the airline said. “My heart goes out to those who were on this flight,” said Alaska CEO Ben Minicucci in a news release. “I am so sorry for what you experienced. I am so grateful for the response of our pilots and flight attendants. We have teams on the ground in Portland assisting passengers and are working to support guests who are traveling in the days ahead.” Alaska is working with Boeing and

SEATTLE, Jan. 6, 2024 /PRNewswire/ — Boeing [NYSE: BA] today issued the following statement: “Safety is our top priority and we deeply regret the impact this event has had on our customers and their passengers. We agree with and fully support the FAA’s decision to require immediate inspections of 737-9 airplanes with the same configuration as the affected airplane. In addition, a Boeing technical team is supporting the NTSB’s investigation into last night’s event. We will remain in close contact with our regulator and customers.” Contact Boeing Communications [email protected] SOURCE Boeing

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 price of $275, raised by $39, reflects a 30x multiple applied to our newly-created 2025 EPS estimate. The applied multiple is moderately above BA’s recent historical forward average, but predicated on an anticipated turnaround in supply chain woes that have weighed on BA post-Covid. We keep our 2023 operating loss estimate of $5.33, and our 2024 EPS estimate of $4.91. We also initiate a 2025 EPS estimate of $9.15. We still think BA has work to do on the supply chain front, as the recent advisory to customers to check on loose bolts would suggest. Nonetheless, we do view this as just a matter of time, and the commercial market outlook for new aircraft continues to improve, with likely tailwinds for both BA and

Embattled Boeing supplier Spirit AeroSystems Holdings caught an upgrade. It isn’t a bullish call, but there is one compelling thing about its shares that investors should consider. On Wednesday, Morgan Stanley analyst Kristine Liwag upgraded shares of Spirit Aero to Hold from Sell. She raised her price target to $35 a share from $22. It isn’t a Buy, but any upgrade is a relief for Spirit Aero investors. Things have been incredibly difficult for the fuselage supplier in recent years. Shares are down about 65% from April 2019, just after the Boeing 737 MAX was grounded worldwide following two deadly crashes. After the MAX grounding came Covid-19, which reduced demand for air travel. Spirit Aero has used more than $1 billion since the MAX grounding just to keep its business afloat. Free cash flow is expected to return in 2024. That and improving demand for air travel prompted the ratings