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Higher Defense Deliveries to Aid Boeing (BA) in Q4 Earnings
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The Boeing Company’s (BA - Free Report) Defense, Space & Security (BDS) segment is likely to have recorded improved fourth-quarter 2022 revenues, thanks to higher deliveries of the company’s defense products. However, higher supply chain costs might have had weighed on the unit’s quarterly bottom-line performance.
Boeing’s fourth-quarter 2022 results are scheduled to be released on Jan 25.
Click here to know how the company’s overall Q4 performance is likely to have been.
Steady Order Flow to Aid Backlog
With the U.S. administration spending significantly on the nation’s defense for the past couple of years, Boeing’s defense and space unit has been witnessing solid order flow from the Pentagon, NASA and Congress for its varied products. This, in turn, has been consistently boosting the BDS unit’s backlogs.
Amid the uncertainties caused by the COVID-19 pandemic, the defense market has been relatively stable. Boeing has been witnessing solid, global demand for its major combat programs, which translated into an overall order value of $5 billion for the BDS unit in the third quarter of 2022. We expect the upcoming results to reflect a similar order count for the BDS unit in terms of a solid backlog figure.
Boeing’s fourth-quarter 2022 defense delivery figures reflected an improvement of 2.1% from the year-ago period.
In the quarter, its defense deliveries totaled 48, up from 47 in the year-ago period. Such improved delivery figures are expected to have boosted the defense segment’s revenues in the soon-to-be-reported quarter.
Notably, the Zacks Consensus Estimate for the company’s defense unit revenues for the fourth quarter, pegged at $6,6136 million, indicates an improvement of 4.7% from the year-ago quarter’s reported figure.
Earnings Prospects
Higher delivery volumes for its defense products are projected to have boosted the BDS segment’s bottom line.
However, higher estimated manufacturing and supply chain costs as well as charges on fixed-price development programs -— the MQ-25 and T-7A program in particular — might have had some adverse impact on the segment’s fourth-quarter earnings.
Notably, the Zacks Consensus Estimate for the company’s defense unit earnings, pegged at a loss of $12 million, indicates a significant improvement from the year-ago quarter’s reported loss of $255 million.
What the Zacks Model Unveils
According to the Zacks model, the combination of two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or better — increases the odds of an earnings surprise.
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 per share, which implies a solid improvement from a loss of 84 cents per share 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 per share, implies 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 per share, indicates a decline of 15.8% from the fourth quarter of 2021.
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Higher Defense Deliveries to Aid Boeing (BA) in Q4 Earnings
The Boeing Company’s (BA - Free Report) Defense, Space & Security (BDS) segment is likely to have recorded improved fourth-quarter 2022 revenues, thanks to higher deliveries of the company’s defense products. However, higher supply chain costs might have had weighed on the unit’s quarterly bottom-line performance.
Boeing’s fourth-quarter 2022 results are scheduled to be released on Jan 25.
Click here to know how the company’s overall Q4 performance is likely to have been.
Steady Order Flow to Aid Backlog
With the U.S. administration spending significantly on the nation’s defense for the past couple of years, Boeing’s defense and space unit has been witnessing solid order flow from the Pentagon, NASA and Congress for its varied products. This, in turn, has been consistently boosting the BDS unit’s backlogs.
Amid the uncertainties caused by the COVID-19 pandemic, the defense market has been relatively stable. Boeing has been witnessing solid, global demand for its major combat programs, which translated into an overall order value of $5 billion for the BDS unit in the third quarter of 2022. We expect the upcoming results to reflect a similar order count for the BDS unit in terms of a solid backlog figure.
The Boeing Company Price and EPS Surprise
The Boeing Company price-eps-surprise | The Boeing Company Quote
Solid Deliveries to Aid Q4 Performance
Boeing’s fourth-quarter 2022 defense delivery figures reflected an improvement of 2.1% from the year-ago period.
In the quarter, its defense deliveries totaled 48, up from 47 in the year-ago period. Such improved delivery figures are expected to have boosted the defense segment’s revenues in the soon-to-be-reported quarter.
Notably, the Zacks Consensus Estimate for the company’s defense unit revenues for the fourth quarter, pegged at $6,6136 million, indicates an improvement of 4.7% from the year-ago quarter’s reported figure.
Earnings Prospects
Higher delivery volumes for its defense products are projected to have boosted the BDS segment’s bottom line.
However, higher estimated manufacturing and supply chain costs as well as charges on fixed-price development programs -— the MQ-25 and T-7A program in particular — might have had some adverse impact on the segment’s fourth-quarter earnings.
Notably, the Zacks Consensus Estimate for the company’s defense unit earnings, pegged at a loss of $12 million, indicates a significant improvement from the year-ago quarter’s reported loss of $255 million.
What the Zacks Model Unveils
According to the Zacks model, the combination of two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or better — increases the odds of an earnings surprise.
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 on Feb 7. 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 per share, which implies a solid improvement from a loss of 84 cents per share 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 per share, implies 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 per share, indicates a decline of 15.8% from the fourth quarter of 2021.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.