Boeing Stock Rises Despite Q4 Miss, Charges Recorded On 787, KC-46 Programs| Investor’s Business Daily

Boeing’s (BA) fourth-quarter results fell short of analyst expectations as it saw charges on its 787 Dreamliner and KC-46 programs. Boeing rose early Wednesday.

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Boeing reported a loss of $7.69 per share as revenue fell 3% to $14.79 billion. FactSet analysts saw a loss of 36 cents per share on revenue of $16.54 billion.

The loss was largely due to Boeing taking a $3.5 billion pre-tax non-cash charge on the 787 Dreamliner program. The halt in deliveries amid discussions with regulators is “taking longer than previously expected,” Boeing said in the earnings release. The company sees abnormal costs related to the 787 increasing to $2 billion, up from an estimate of $1 billion in Q3, with most of the cost incurred by the end of 2023.

Commercial revenue rose to $4.8 billion helped by higher 737 deliveries. But the figure is below the $5.58 billion FactSet expected due to the 787 delays.

Boeing recorded 79 orders in Q4, for a total of 479 net orders on the year. It delivered 99 commercial jets in the fourth quarter.

It’s been a year since the 737 Max has returned to service in the U.S. and Europe. But Chinese regulators, the first to ground the Max back in 2019, have been slow to recertify the aircraft. But on Jan. 9, a Hainan Airlines 737 Max flew from Taiyuan to Haikou, according to Chinese media reports. That would mark the first domestic Chinese 737 flight since the grounding in March 2019.

Overall, carriers are eager to get more 737 Max jets. Alaskan Air (ALK), Southwest Airlines (LUV) and Allegiant Air, owned by Allegiant Travel (ALGT) placed orders for the 737 Max aircraft during the quarter.

Boeing said it is currently producing 737 Max jets at a rate of 26 per month as it looks to move to a rate of 31 per month in early 2022.  The company is evaluating the timing of further rate increases.

Free cash flow turned positive to $494 million from negative $4.27 billion in the year-ago quarter. The total company backlog was $377 billion at the end of the quarter.

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On the defense and space side, revenue fell 14% to $5.86 billion.  The Dow Jones aerospace giant recorded a $402 million pre-tax charge on the KC-46 tanker for the U.S. Air Force.

Still, the company has been investing in new technologies that could take flight later this decade. Earlier this month, Boeing said it would invest $450 million in Wisk Aero, an autonomous air taxi start-up.

Shares rose 2.1% to 208.40 in pre-market trading the stock market today. Boeing stock is back below its down-trending 50-day moving average. Shares have been unable to muster a sustained campaign above that level of resistance since April last year.

But investors should keep an eye on Boeing stock as it’s currently in a very long consolidation with a 278.67 buy point, according to MarketSmith analysis.

Follow Gillian Rich on Twitter for aviation news and more.

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