HomeMost PopularThe Boeing Company: Navigating Turbulence With Q4 2023 Earnings Looming

The Boeing Company: Navigating Turbulence With Q4 2023 Earnings Looming

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Boeing Logo on Building

A Restless Cloud Over Boeing’s Earnings Season

As the welcoming bell tolls on Wednesday, January 31 ’24, a collective apprehension encircles Boeing (NYSE:BA) amidst its upcoming calendar Q4 ’23 financial reveal. With an EPS estimate of ($0.78) and a revenue projection of $21.1 billion eagerly anticipated, the stakes remain high. The post-earnings terrain will be heavily influenced by the forthcoming conference call, any potential order cancellations, and most crucially, the veiled integrity of the ’25-26 cash flow and production narrative.

A Grim Shadow Cast Over Earnings Estimations

Perplexingly, the forecasted earnings per share for BA in 2023 appear futile given the year’s incurred losses. While the 2024 earnings per share outlook still brandishes a veil of optimism, it has withered by more than half over the past 12-14 months.

Forecasting The Ripples of Revenue Estimates

Peering beyond the earnings, the scrutiny shifts to Boeing’s revenue projections for ’24-26. These upcoming alterations will illuminate the ramifications of potential aircraft order cancellations and provide a litmus test for the disjunction between media sensationalism and actual industry realities.

Evaluating the Ominous Stretches

It’s paramount to note that despite the predicaments faced, the 2024 revenue estimate has remained steadfast within the $100 million threshold for the last four months, with a marginal uptick in the 2025 projections. However, this offers scant solace in the prevailing narrative.

Revisiting BA’s Position and Prospects

The meteoric rise of BA’s stock from the $180 mark in November to a culminating $260 by year-end 2023 proved to be an evanescent marvel. The subsequent tumultuous events, akin to the sudden malfunction of the Alaska Air aircraft, have veiled investor sentiments with a cloud of skepticism, echoing the despondency palpable among Detroit Lions fans after the recent NFC Championship.

Seeking Anchorage Amidst Market Turbulence

Notwithstanding the prevailing volatility, a sturdy foundation for the stock seems to solidify around the $200 mark, aligned with the 200-week moving average. Yet, this foundation appears vulnerable, as its trajectory veers downwards. The post-earnings trajectory will be intrinsically tethered to the interplay between stock performance, media portrayals, and management discourse.

The Indomitable Fortitude of Boeing

Boeing’s innate prowess is underscored by its commanding position and the oligopolistic backdrop of the aircraft manufacturing sphere. With only three enterprises wielding the capacity to manufacture 50 airplanes monthly – namely Boeing, Airbus (OTCPK:EADSF), and the burgeoning Chinese contender, COMAC – the latter pales in comparison, casting Boeing and Airbus as irrefutable dominators.

Weathering the Tempestuous Tides

An additional testament to BA’s resilience stems from the tranquil comportment exuded by Boeing’s corporate bonds, exhibiting no overt strain or anomalous trading pressures amidst the recent spate of adversities.

Challenging the Future Narrative

Renowned as a ’25-26 cash flow saga, as per the Street consensus and the Q3 ’23 conference call, Boeing’s singular objective centers around attaining a scale of 50 planes per month by ’25-26. Thus, the primal focal point gravitates toward discerning any substantial deviations in this production schedule post-earnings. The impending revelation of ’25-26 revenue estimates will serve as an allegorical barometer of tomorrow’s unveiling.

Battling the Media Blizzard

Comparable to Tesla’s recent predicament, Boeing finds itself ensnared within a labyrinth of negative media scrutiny. The deliberation lies in discerning the extent to which this relentless deluge of disparaging reports is factored into the stock price, against the backdrop of potential airline order cancellations.

Awaiting the Market Oscillations

Morningstar allots a fair valuation of $232 to the stock, predicating manufacturing defects costs between $1 and $32 per share. The ensuing fair value remains anchored at $200, paralleling the prevailing stock price under a worst-case scenario.

Client Insights and Investment Prescience

Clients retain a 1.5-1.6% stake in the stock, a position likely upheld until after the post-earnings revelations are assimilated and meticulously vetted.

A Palpable Air of Uncertainty

The investment stratagem for Boeing invariably adheres to a β€˜play the long game’ equilibrium. Purchasing stocks on the cusp of earnings necessitates a wise discernment of the unknowns and latent disclosures liable to transpire.

A Concluding Sojourn

Operations remain fiducially entrenched with a 1.5% position in the stock poised for retention until the curtain-raiser on Q4 ’23 results unfurls and dissects. Adhering to the dictum that past performance is no vanguard of future outcomes, investing admonitions steer investors to exercise caution in light of potential stock price upheavals reverberating from earnings releases.

Thank you for your readership.

Original Post

Editor’s Note: The summary bullets for this article were chosen by Seeking Alpha editors.

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