Boeing Stock: Dow Giant Rises With Earnings On Deck. Dow Giant To Update On 737 Max, 787 Dreamliner After Delays.

Boeing (BA) plans to report earnings for the second quarter early Wednesday amid signs of improving production after delayed jet deliveries. Boeing stock rose Monday near a buy point.

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Rival European plane-maker Airbus (EADSY) is also due to report Wednesday. Their jet-engine supplier General Electric (GE) reports earnings Tuesday before the open.

Dow Giant Boeing To Update On 737, 787 Jets

Along with the Q2 earnings report, the Dow Jones aviation and defense giant is likely to update investors on its plans to increase output of the 737 Max to 38 per month later this year, from 31. Boeing also seeks to increase production of the 787 Dreamliner to five planes a month, from three, later this year.

Analysts at Bank of America are watching the impact of the recent, short-lived strike by Spirit AeroSystems (SPR) union workers on Boeing’s production targets.

“We maintain that the pause could impact 737 Max production, profitability and result in a SPR charge related to the strike and its resolution,” BofA analyst Ronald Epstein wrote in a July 12 note to clients.

Boeing Earnings

Estimates: Analysts expect Boeing to widen losses to 88 cents per share from 37 cents a year ago. Revenue is seen rebounding 11%, year over year, to $18.521 billion.

Results: Check back early Wednesday.

Outlook: Wall Street forecasts another Boeing loss in the current third quarter followed by a return to profits in Q4. For the full year, they expect Boeing to lose $1.29 per share, a sharp improvement from an $11.06 loss in 2022.

The company has also guided free cash flow for the full year of $3 billion-$5 billion. For Boeing, the pace of aircraft deliveries is key to its cash flow target. That is because customers make the bulk of payments upon delivery.

Boeing Stock Near Buy Point

Shares of the Dow Jones aviation giant climbed 1.9% to 215.87 in Monday’s stock market action. Boeing stock is forming a flat base with a 223.91 buy point above the 50-day moving average, the IBD MarketSmith chart shows. BA stock has been trading in a narrow range since mid-February, following a strong rally starting last October.

Spirit stock and Airbus stock also rose Monday.

Boeing stock helped to lead the Dow Jones’s advance Monday. The Dow index scored its 11th straight day of gains.

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Seeing Momentum But Issues Remain

Commercial aviation continues to recover after the Covid-19 pandemic, with a further boost from China’s reopening this year. Plane-makers are trying to ramp up production to meet robust demand from airline customers.

Boeing has delivered 266 aircraft in the first six months of 2023 vs. 316 deliveries for Airbus. The Dow giant also reports swelling aircraft orders.

In Q2, Boeing managed to deliver 136 aircraft, a 5% increase from the prior quarter. That included 60 deliveries in June, the most since March.

But Bank of America analyst Epstein noted that 13% of Boeing’s 737 deliveries in June were from storage, vs. 5% in April and May, amid a weeklong work stoppage at Spirit AeroSystems.

In his July 12 note, Epstein questioned whether the quarterly delivery increase was a sign of Boeing “turning the page” or a sign of inventory wind-down.

“This (more deliveries out of inventory in June than before) could indicate that Boeing is not receiving shipsets at an adequate pace,” he said.

“We hope to get further clarity come Q2 earnings as to the financial impact of these delays,” he added.

In China, almost 90% of 737 Max planes had resumed commercial operations at the end of June. But it remains uncertain when Boeing will restart deliveries there, Epstein said.

Spirit reports Aug. 2 before the market open.

The aerospace supplier makes the entire body of Boeing’s bestselling 737 Max jet. It also makes fuselages and pylons for both Boeing and Airbus, but has been the source of many issues.

Year to date, Boeing stock is up 13.3%, including a 4.9% gain in the past three months.

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