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Will Robust Aftermarket Service Aid Boeing (BA) in Q4 Earnings?
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The Boeing Company (BA - Free Report) is set to release its fourth-quarter 2022 results on Jan 25, before the opening bell.
In the last reported quarter, the company incurred a loss of $6.18 per share, much wider than the Zacks Consensus Estimate of a loss of a penny. Solid delivery figures, both commercial and defense, along with robust aftermarket commercial jet services trend, must have boosted Boeing’s fourth-quarter earnings performance amid lower defense deliveries.
Solid Product Deliveries to Aid Results
Boeing’s fourth-quarter deliveries reflected a solid 53.5% surge in commercial shipments from the year-ago reported figure. Also, defense shipments rose 2.1% year over year.
For manufacturing companies like Boeing, successful deliveries of finished products play a crucial role in boosting its revenue growth. Therefore, such a significant improvement witnessed in the jet maker’s deliveries for both its commercial and defense segments is expected to benefit Boeing’s overall fourth-quarter results.
The jet giant’s military and commercial business revenues comprised almost 43% and 31% of its total revenues (as of 2021-end), respectively, thereby together constituting almost 75% of its total revenues. The year-over-year improvement witnessed in both commercial and defense shipments can be expected to have boosted the company’s overall Q4 top-line performance.
Expectations for BGS
As far as Boeing Global Services (BGS) unit’s fourth-quarter performance is concerned, we remain optimistic.
Notably, a consistent recovery in domestic air travel and recent growth observed in international travel are expected to have bolstered fleet utilization, thereby once again boosting aftermarket commercial jet services in the fourth quarter of 2022. This, as well as a robust cargo market with several Boeing converted freighter and materials management agreements, must have added an impetus to BGS unit’s Q4 revenues.
However, the discontinuation of an engine distribution agreement since the second quarter might have led to lower government volume, thereby partly impacting the overall performance of the BGS unit in Q4. The Zacks Consensus Estimate for BGS unit revenues, pegged at $4,671 million, indicates an improvement of 8.9% from its fourth-quarter 2021 reported revenues.
The consensus mark for this segment’s earnings is pegged at $731 million, which indicates a solid improvement of 82.3% from its fourth-quarter 2021 reported earnings.
Cash Flow Projections
Improved air travel statistics in recent times, which resulted in higher 737 deliveries, along with higher order receipts as well as increased aftermarket services, are likely to have contributed to Boeing’s cash flow reserve in the fourth quarter of 2022.
Q4 Expectations
Considering the aforementioned discussion, we remain optimistic about BA’s overall Q4 revenue and earnings performance. However, the abnormal costs in relation to the 787 program, along with supply chain constraints, might have had some adverse impact on the company’s bottom line.
The Zacks Consensus Estimate for Boeing’s total revenues is pegged at $19.43 billion, suggesting a 31.3% improvement from the prior-year reported number. The consensus estimate for the bottom line is pegged at an earnings of 30 cents per share, indicating a significant improvement from the year-ago quarter’s loss of $7.69.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for Boeing this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. However, this is not the case for BA.
Boeing has an Earnings ESP of -119.45% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Below are three defense stocks that have the right combination for an earnings beat:
SPR delivered a four-quarter average negative earnings surprise of 73.24%. The Zacks Consensus Estimate for Spirit AeroSystem’s fourth-quarter bottom line is pegged at a loss of 48 cents, which implies a solid improvement from a loss of 84 cents incurred in the fourth quarter of 2021.
Leidos Holdings (LDOS - Free Report) : It is scheduled to release its fourth-quarter results on Feb 14. LDOS has an Earnings ESP of +1.19% and a Zacks Rank #3.
LDOS delivered a four-quarter average earnings surprise of 2.01%. The Zacks Consensus Estimate for Leidos’ fourth-quarter earnings, pegged at $1.61, suggests an improvement of 3.2% from the fourth quarter of 2021.
Airbus Group (EADSY - Free Report) is slated to report its fourth-quarter results soon. EADSY has an Earnings ESP of +6.25% and a Zacks Rank #2.
EADSY delivered a four-quarter average earnings surprise of 59.88%. The Zacks Consensus Estimate for EADSY’s fourth-quarter earnings, pegged at 48 cents, reflects a decline of 15.8% from the fourth quarter of 2021.
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Will Robust Aftermarket Service Aid Boeing (BA) in Q4 Earnings?
The Boeing Company (BA - Free Report) is set to release its fourth-quarter 2022 results on Jan 25, before the opening bell.
In the last reported quarter, the company incurred a loss of $6.18 per share, much wider than the Zacks Consensus Estimate of a loss of a penny. Solid delivery figures, both commercial and defense, along with robust aftermarket commercial jet services trend, must have boosted Boeing’s fourth-quarter earnings performance amid lower defense deliveries.
Solid Product Deliveries to Aid Results
Boeing’s fourth-quarter deliveries reflected a solid 53.5% surge in commercial shipments from the year-ago reported figure. Also, defense shipments rose 2.1% year over year.
For manufacturing companies like Boeing, successful deliveries of finished products play a crucial role in boosting its revenue growth. Therefore, such a significant improvement witnessed in the jet maker’s deliveries for both its commercial and defense segments is expected to benefit Boeing’s overall fourth-quarter results.
The Boeing Company Price and EPS Surprise
The Boeing Company price-eps-surprise | The Boeing Company Quote
The jet giant’s military and commercial business revenues comprised almost 43% and 31% of its total revenues (as of 2021-end), respectively, thereby together constituting almost 75% of its total revenues. The year-over-year improvement witnessed in both commercial and defense shipments can be expected to have boosted the company’s overall Q4 top-line performance.
Expectations for BGS
As far as Boeing Global Services (BGS) unit’s fourth-quarter performance is concerned, we remain optimistic.
Notably, a consistent recovery in domestic air travel and recent growth observed in international travel are expected to have bolstered fleet utilization, thereby once again boosting aftermarket commercial jet services in the fourth quarter of 2022. This, as well as a robust cargo market with several Boeing converted freighter and materials management agreements, must have added an impetus to BGS unit’s Q4 revenues.
However, the discontinuation of an engine distribution agreement since the second quarter might have led to lower government volume, thereby partly impacting the overall performance of the BGS unit in Q4. The Zacks Consensus Estimate for BGS unit revenues, pegged at $4,671 million, indicates an improvement of 8.9% from its fourth-quarter 2021 reported revenues.
The consensus mark for this segment’s earnings is pegged at $731 million, which indicates a solid improvement of 82.3% from its fourth-quarter 2021 reported earnings.
Cash Flow Projections
Improved air travel statistics in recent times, which resulted in higher 737 deliveries, along with higher order receipts as well as increased aftermarket services, are likely to have contributed to Boeing’s cash flow reserve in the fourth quarter of 2022.
Q4 Expectations
Considering the aforementioned discussion, we remain optimistic about BA’s overall Q4 revenue and earnings performance. However, the abnormal costs in relation to the 787 program, along with supply chain constraints, might have had some adverse impact on the company’s bottom line.
The Zacks Consensus Estimate for Boeing’s total revenues is pegged at $19.43 billion, suggesting a 31.3% improvement from the prior-year reported number. The consensus estimate for the bottom line is pegged at an earnings of 30 cents per share, indicating a significant improvement from the year-ago quarter’s loss of $7.69.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for Boeing this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. However, this is not the case for BA.
Boeing has an Earnings ESP of -119.45% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Below are three defense stocks that have the right combination for an earnings beat:
Spirit AeroSystems (SPR - Free Report) : It is scheduled to release its fourth-quarter results soon. SPR has an Earnings ESP of +93.75% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
SPR delivered a four-quarter average negative earnings surprise of 73.24%. The Zacks Consensus Estimate for Spirit AeroSystem’s fourth-quarter bottom line is pegged at a loss of 48 cents, which implies a solid improvement from a loss of 84 cents incurred in the fourth quarter of 2021.
Leidos Holdings (LDOS - Free Report) : It is scheduled to release its fourth-quarter results on Feb 14. LDOS has an Earnings ESP of +1.19% and a Zacks Rank #3.
LDOS delivered a four-quarter average earnings surprise of 2.01%. The Zacks Consensus Estimate for Leidos’ fourth-quarter earnings, pegged at $1.61, suggests an improvement of 3.2% from the fourth quarter of 2021.
Airbus Group (EADSY - Free Report) is slated to report its fourth-quarter results soon. EADSY has an Earnings ESP of +6.25% and a Zacks Rank #2.
EADSY delivered a four-quarter average earnings surprise of 59.88%. The Zacks Consensus Estimate for EADSY’s fourth-quarter earnings, pegged at 48 cents, reflects a decline of 15.8% from the fourth quarter of 2021.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.