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Boeing (BA) Wins Order for Up to 67 Jets From Ethiopian Airlines
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The Boeing Company (BA - Free Report) recently clinched an order from Ethiopian Airlines to deliver 11 of its 787-9 Dreamliner jets and 20 of its 737 MAX jets, with an additional opportunity for 15 and 21 jets, respectively. This order represents the largest-ever purchase of Boeing airplanes made by an African airline.
Significance of 787-9 & 737 Max Jets
The Boeing 787-9 aircraft provides 25% better fuel per seat and lesser emissions than the airplanes it will replace. Since its launch, orders for 750 787 Dreamliner airplanes have been placed across the world. Coming to the company’s latest achievements in this space, it received an order for 30 jets from flydubai, two from Royal Air Maroc and four from Royal Jordanian.
The Boeing 737-8 MAX reduces fuel use and emissions by 20% while producing a 50% smaller noise footprint than the airplanes it replaces. Coming to the recent achievements, Boeing received an order for 7 737-8 airplanes from SCAT Airlines and 28 737-8 and 17 737-10 airplanes from SunExpress.
Revenues earned from these deliveries, including the latest deal for 31 jets, will significantly bolster Boeing’s commercial unit’s top line, which witnessed a solid 25% year-over-year improvement in the last reported quarter.
Prospects in the African Aviation Market
As we continue to witness a steady recovery in the aviation industry over the past few months, the African region has seen an upward growth trend. To this end, Boeing’s commercial market outlook estimates the overall air traffic growth in Africa will be at 7.4% through 2042, above the global average growth rate of 6.1%. It also projects the continent will need 1,030 airplanes over the next two decades, with 70% of the market being dominated by Boeing.
With its established presence in this region, further enhanced by the recent orders, Boeing’s profitability should increase in the coming days.
Peer Prospects
Another aerospace player that can gain from the expanding aviation market in the African region is Airbus SE (EADSY - Free Report) .
Airbus has created its presence in Africa for around 50 years now. The company’s aircraft, like A350, A330neo, A320neo and A220, have been delivered to African carriers. In June 2023, Air Algérie had placed an order for five A330-900s and two A350-1000s. These are the latest generation of Airbus widebody aircraft.
EADSY boasts a long-term (three- to five years) earnings growth rate of 12.4%. The Zacks Consensus Estimate for 2023 sales indicates an improvement of 12.4% from that reported in 2022.
Price Performance
In the past year, shares of BA have rallied 18.8% against the industry’s 8.5% decline.
TXT boasts a long-term earnings growth rate of 11.7%. The Zacks Consensus Estimate for 2023 sales indicates an improvement of 6.9% from that reported in 2022.
SPCE boasts a long-term earnings growth rate of 40.3%. The Zacks Consensus Estimate for 2023 sales indicates an improvement of 171.9% from that reported in 2022.
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Boeing (BA) Wins Order for Up to 67 Jets From Ethiopian Airlines
The Boeing Company (BA - Free Report) recently clinched an order from Ethiopian Airlines to deliver 11 of its 787-9 Dreamliner jets and 20 of its 737 MAX jets, with an additional opportunity for 15 and 21 jets, respectively. This order represents the largest-ever purchase of Boeing airplanes made by an African airline.
Significance of 787-9 & 737 Max Jets
The Boeing 787-9 aircraft provides 25% better fuel per seat and lesser emissions than the airplanes it will replace. Since its launch, orders for 750 787 Dreamliner airplanes have been placed across the world. Coming to the company’s latest achievements in this space, it received an order for 30 jets from flydubai, two from Royal Air Maroc and four from Royal Jordanian.
The Boeing 737-8 MAX reduces fuel use and emissions by 20% while producing a 50% smaller noise footprint than the airplanes it replaces. Coming to the recent achievements, Boeing received an order for 7 737-8 airplanes from SCAT Airlines and 28 737-8 and 17 737-10 airplanes from SunExpress.
Revenues earned from these deliveries, including the latest deal for 31 jets, will significantly bolster Boeing’s commercial unit’s top line, which witnessed a solid 25% year-over-year improvement in the last reported quarter.
Prospects in the African Aviation Market
As we continue to witness a steady recovery in the aviation industry over the past few months, the African region has seen an upward growth trend. To this end, Boeing’s commercial market outlook estimates the overall air traffic growth in Africa will be at 7.4% through 2042, above the global average growth rate of 6.1%. It also projects the continent will need 1,030 airplanes over the next two decades, with 70% of the market being dominated by Boeing.
With its established presence in this region, further enhanced by the recent orders, Boeing’s profitability should increase in the coming days.
Peer Prospects
Another aerospace player that can gain from the expanding aviation market in the African region is Airbus SE (EADSY - Free Report) .
Airbus has created its presence in Africa for around 50 years now. The company’s aircraft, like A350, A330neo, A320neo and A220, have been delivered to African carriers. In June 2023, Air Algérie had placed an order for five A330-900s and two A350-1000s. These are the latest generation of Airbus widebody aircraft.
EADSY boasts a long-term (three- to five years) earnings growth rate of 12.4%. The Zacks Consensus Estimate for 2023 sales indicates an improvement of 12.4% from that reported in 2022.
Price Performance
In the past year, shares of BA have rallied 18.8% against the industry’s 8.5% decline.
Image Source: Zacks Investment Research
Zacks Rank & Key Picks
Boeing currently has a Zacks Rank #4 (Sell).
A couple of better-ranked stocks in the same industry are Textron Inc. (TXT - Free Report) and Virgin Galactic Holdings, Inc. (SPCE - Free Report) , each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
TXT boasts a long-term earnings growth rate of 11.7%. The Zacks Consensus Estimate for 2023 sales indicates an improvement of 6.9% from that reported in 2022.
SPCE boasts a long-term earnings growth rate of 40.3%. The Zacks Consensus Estimate for 2023 sales indicates an improvement of 171.9% from that reported in 2022.