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Boeing (BA) Down 7% Since Last Earnings Report: Can It Rebound?
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It has been about a month since the last earnings report for Boeing (BA - Free Report) . Shares have lost about 7% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Boeing due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
The Boeing Company incurred an adjusted loss of 82 cents per share in second-quarter 2023, narrower than the Zacks Consensus Estimate of a loss of 99 cents. The bottom line, however, deteriorated from the year-ago quarter’s reported loss of 37 cents per share.
The year-over-year downside can be attributed to lower defense margins.
Including one-time items, the company reported GAAP loss of 25 cents per share against the year-ago quarter’s reported earnings of 32 cents.
Revenues
Boeing’s revenues amounted to $19.75 billion, which beat the Zacks Consensus Estimate of $18.46 billion by 7%. The top line also improved 18% from the year-ago quarter’s reported figure of $16.68 billion.
This improvement was driven by higher year-over-year revenues registered by the company’s Commercial Airplanes and Global Services business units.
Total Backlog
Backlog at the end of the second quarter was $439.56 billion, up from $411.45 billion recorded at the end of first-quarter 2023.
Segmental Performances
Commercial Airplane: Revenues at this segment increased 41% year over year to $8.84 billion, driven by higher 787 deliveries. The segment incurred an operating loss of $383 million compared with an operating loss of $219 million in the year-ago quarter.
Boeing delivered 136 commercial planes during the quarter under review, up 12% year over year.
The backlog for this segment remained healthy, with more than 4,800 airplanes valued at $363 billion.
Boeing Defense, Space & Security (BDS): The segment recorded revenues of $6.17 billion, indicating a year-over-year decline of 0.4%. This was primarily driven by lower defense deliveries. The unit incurred an operating loss of $527 million against an operating income of $71 million in the year-ago quarter.
BDS recorded a backlog of $58 billion, 31% of which comprised of orders from international clients.
Global Services: Revenues at this segment improved 10% to $4.75 billion. This unit generated an operating income of $856 million compared with $728 million in the prior-year quarter, driven by higher commercial volume and favorable mix.
Boeing Capital Corporation (BCC): This segment reported negative quarterly revenues of $2 million.
Financial Condition
Boeing exited second-quarter 2023 with cash and cash equivalents of $7.25 billion, and short-term and other investments of $6.51 billion. At the end of 2022, the company had cash and cash equivalents of $14.61 billion, and short-term and other investments of $2.61 billion. Long-term debt amounted to $47.66 billion at the end of the second quarter, down from $51.81 billion recorded at the end of 2022.
The company’s operating cash flow as of Jun 30, 2023, was $2,557 million against cash outflow of $3.14 billion at the end of second-quarter 2022.
Free cash flow totaled $1,793 million at the end of second-quarter 2023 against free cash outflow of $3.75 billion at the end of second-quarter 2022.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended downward during the past month.
The consensus estimate has shifted -325.09% due to these changes.
VGM Scores
At this time, Boeing has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Boeing has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Boeing (BA) Down 7% Since Last Earnings Report: Can It Rebound?
It has been about a month since the last earnings report for Boeing (BA - Free Report) . Shares have lost about 7% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Boeing due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Boeing's Q2 Earnings Beat Estimates, Revenues Rise Y/Y
The Boeing Company incurred an adjusted loss of 82 cents per share in second-quarter 2023, narrower than the Zacks Consensus Estimate of a loss of 99 cents. The bottom line, however, deteriorated from the year-ago quarter’s reported loss of 37 cents per share.
The year-over-year downside can be attributed to lower defense margins.
Including one-time items, the company reported GAAP loss of 25 cents per share against the year-ago quarter’s reported earnings of 32 cents.
Revenues
Boeing’s revenues amounted to $19.75 billion, which beat the Zacks Consensus Estimate of $18.46 billion by 7%. The top line also improved 18% from the year-ago quarter’s reported figure of $16.68 billion.
This improvement was driven by higher year-over-year revenues registered by the company’s Commercial Airplanes and Global Services business units.
Total Backlog
Backlog at the end of the second quarter was $439.56 billion, up from $411.45 billion recorded at the end of first-quarter 2023.
Segmental Performances
Commercial Airplane: Revenues at this segment increased 41% year over year to $8.84 billion, driven by higher 787 deliveries. The segment incurred an operating loss of $383 million compared with an operating loss of $219 million in the year-ago quarter.
Boeing delivered 136 commercial planes during the quarter under review, up 12% year over year.
The backlog for this segment remained healthy, with more than 4,800 airplanes valued at $363 billion.
Boeing Defense, Space & Security (BDS): The segment recorded revenues of $6.17 billion, indicating a year-over-year decline of 0.4%. This was primarily driven by lower defense deliveries. The unit incurred an operating loss of $527 million against an operating income of $71 million in the year-ago quarter.
BDS recorded a backlog of $58 billion, 31% of which comprised of orders from international clients.
Global Services: Revenues at this segment improved 10% to $4.75 billion. This unit generated an operating income of $856 million compared with $728 million in the prior-year quarter, driven by higher commercial volume and favorable mix.
Boeing Capital Corporation (BCC): This segment reported negative quarterly revenues of $2 million.
Financial Condition
Boeing exited second-quarter 2023 with cash and cash equivalents of $7.25 billion, and short-term and other investments of $6.51 billion. At the end of 2022, the company had cash and cash equivalents of $14.61 billion, and short-term and other investments of $2.61 billion. Long-term debt amounted to $47.66 billion at the end of the second quarter, down from $51.81 billion recorded at the end of 2022.
The company’s operating cash flow as of Jun 30, 2023, was $2,557 million against cash outflow of $3.14 billion at the end of second-quarter 2022.
Free cash flow totaled $1,793 million at the end of second-quarter 2023 against free cash outflow of $3.75 billion at the end of second-quarter 2022.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended downward during the past month.
The consensus estimate has shifted -325.09% due to these changes.
VGM Scores
At this time, Boeing has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Boeing has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.