Boeing Company | $BA Stock | Shares Slump On Dim Outlook & Weak Commercial Airplanes Revenue

Boeing Photo

Boeing Company (NYSE: BA)


Boeing stock dropped more than 3% before the opening bell Wednesday, after the company posted disappointing second-quarter commercial airline sales.

Investors also seem to have been angered by its 2018 EPS guidance. Shares of the Dow component have soared 21% since the beginning of the year.

BA Earnings & Outlook

The company reported net income of $2.20 billion, or $3.73 per share, compared with $1.75 billion, or $2.87 per share, in the year-ago quarter.

After stripping out special items and amortization expenses, earnings per share were $3.33, ahead of estimates of $3.25 per share.

Revenue came in at $24.26 billion, up 5% from the previous quarter, and above Thompson estimates of $24.04 billion.

Sales from its Commercial Airplanes segment were $14.48 billion, up 1% from the earlier-year period.

However, the sales failed to beat estimates of $14.86 billion from Thompson Reuters. Meanwhile, the Defense, Space and Security segment recorded sales of $5.59 billion, an increase of 9% from the previous year, and above estimates of $5.40 billion.

The company lifted its revenue outlook for the full year to between $97 billion and $99 billion, from its earlier forecast of $96 billion to $98 billion.

As for per-share earnings, Boeing maintained its guidance of between $14.30 and $14.50. Analysts have modeled yearly per-share earnings of $14.53 on revenue of $98 billion.

Boeing CEO Comments

Boeing President and Chief Executive Officer Dennis Muilenburg commented, “We are seeing the results of our One Boeing approach as our teams work together across the Boeing enterprise to deliver value to our customers and grow our business. In the quarter, we generated improved revenue and earnings, delivered strong cash and captured $27 billion in new orders.

Continued services growth, increasing defense volume and strong performance of our commercial business, as well as our positive market outlook, give us the confidence to raise our revenue and Commercial Airplanes margin guidance for the year. We remain focused on execution, driving innovation, continuing to develop and maintain the best team and talent in the industry, and increasing value for our customers, shareholders, employees and other stakeholders,” concluded Muilenburg.

Boeing Company Profile

Boeing is an American aerospace firm that is involved in the manufacture of commercial airplanes, as well as space, security, and defense systems.

Its segments of operation are as follows; Defense, Space and Security; Commercial Airplanes; Boeing Capital and; Global Services.

The Commercial Airplanes division engages in the development, production, and marketing of commercial jet airliners. Further, this segments also offers fleet support services, mainly to the commercial airline sector internationally.

The Defense, Space and Security category researches, develops, produces and modifies unmanned and manned military weapons; and aircraft systems for worldwide strike, including global mobility, including tilt-rotor aircraft, tanker, and rotorcraft; and combat and fighter missile systems and rotorcraft aircraft.  

The segment also offers airborne reconnaissance and surveillance, including control and command, airborne anti-submarine aircraft and battle management.

The Boeing Capital division seeks to make sure that customers of the company have the financing they require to buy their Boeing products. It is also take care of overall financing exposure.

The Global Services division offers services to defense and commercial customers. The Boeing Company was founded in 1916 by William Edward Boeing. Its headquarters are located in Chicago, Illinois. –Reuters