Boeing stock is steady despite big losses from airline customers

Boeing stock has steadily been moving upward despite big losses from passenger airlines, resulting in massive order cuts for new planes. Although the shares of the largest airplane maker jumped 20% in the past six months, the stock price is still down almost by 50% so far this year.
Boeing has generated massive revenue and order backlog drop in the latest quarter. Its commercial airplanes segment reported a 78% year over year drop in revenues, while Global Services revenue plunged 23%. The market analysts are expecting similar losses for the third quarter.
BA The Boeing Company daily Stock Chart

Airlines Losses Could Negatively Impact Boeing Stock

The US airline industry reported hefty losses in the third quarter, with expectations that the airline industry will take a longer time for a full recovery. Delta, United Airlines, American Airlines, and Southwest Airlines lost billions in the quarter and flew planes that were roughly half compared to the year-ago period.
Consequently, airline companies have been cutting their orders for new planes. For instance, American announced that it is deferring deliveries of 18 MAX jets until 2023-24. The airline says they expect the demand to improve in the next two years.
Southwest also announced to restructure orders for MAX delivery. TSA data shows that US air traveling is still down close to 60% in the last month from the past year period.

Boeing Stock is Getting Support from 737 MAX Approval

Boeing shares have lost significant value in the past two years after its two 737 MAX planes crashed. However, after two years, the 737 MAX jet again get regulatory approval. The company said they expect to fly the MAX jets by the end of this year.
“We have to schedule and complete pilot training for roughly 7,000 pilots. We have maintenance work to do to bring our own MAX aircraft out of long-term storage and into an operational status, and we’ll be doing operational readiness and validation flights on the aircraft before they return to revenue service,” said Southwest COO Michael Van de Ven.

Alex Livermore


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