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Will Dismal Defense Deliveries Hurt Boeing's (BA) Q1 Earnings?
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The Boeing Company’s (BA - Free Report) Defense, Space & Security segment is likely to record unimpressive 2024 revenues, owing to lower year-over-year deliveries of its defense products.
However, supply-chain constraints are likely to have had an adverse impact on the BDS segment’s earnings. Boeing’s first-quarter 2024 results are scheduled to be released on Apr 24.
Click here to know how the company’s overall performance might have been in the soon-to-be-reported quarter.
Steady Order Flow to Aid Backlog
With the U.S. administration spending significantly on the nation’s defense capabilities for the past few years, the Boeing Defense, Space & Security (BDS) unit has been witnessing solid order flow from the Pentagon, NASA and Congress for its varied products. Moreover, the diverse regional threats witnessed across Asia, Europe and the Middle East have also been offering growth opportunities for this unit’s products.
Consequently, Boeing has been witnessing a solid global demand for its major combat programs, which translated into an overall order value of $8 billion for the BDS unit in the fourth quarter of 2023. Such solid order values thereby bolster the BDS segment’s backlog.
We expect the upcoming results to reflect a similar order count for the unit, thereby bolstering its backlog figure.
Have Dismal Deliveries Hurt Q1 Performance?
Boeing’s first-quarter defense delivery figures indicate a deterioration of 66.7% from the year-ago period’s level.
Its defense deliveries totaled 14, down from 42 in the prior-year quarter. Such dismal delivery figures are expected to have hurt the defense segment’s revenues in the soon-to-be-reported quarter. Nevertheless, increased sales from space and proprietary programs might have partially aided the BDS unit’s top-line performance.
The Zacks Consensus Estimate for the defense unit’s revenues is pegged at $6,379 million, indicating a decline of 2.4% year over year.
Earnings Prospect
Strong order activities in the previous quarters as well as lower charges from development programs, as BA progresses in these programs, are expected to have favorably contributed to BDS’ earnings performance.
The consensus estimate for BDS’ earnings is pegged at a loss of $62.5 million, indicating a significant improvement from the year-ago quarter’s reported loss of $212 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 #1 (Strong Buy), #2 (Buy) or #3 (Hold) — increases the odds of an earnings beat. That is not the case here.
Boeing has an Earnings ESP of -15.87% and a Zacks Rank #5 (Strong Sell) at present. 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 of elements to post an earnings beat this reporting cycle.
Huntington Ingalls delivered a four-quarter average earnings surprise of 20.64%. The consensus estimate for first-quarter earnings is pegged at $3.49 per share, while that for sales is pinned at $2.80 billion.
Leidos Holdings (LDOS - Free Report) is scheduled to release first-quarter results on Apr 30. LDOS has an Earnings ESP of +1.86% and a Zacks Rank #2 at present.
Leidos delivered a four-quarter average earnings surprise of 11.85%. The Zacks Consensus Estimate for LDOS’ first-quarter earnings is pegged at $1.65 per share, while that for sales is pinned at $3.80 billion.
CurtissWright (CW - Free Report) is slated to report first-quarter results on May 1. CW has an Earnings ESP of +0.23% and a Zacks Rank #2 at present.
CW delivered a four-quarter average earnings surprise of 7.71%. The consensus mark for CW’s first-quarter earnings is pegged at $1.75 per share, while that for sales is pinned at $665 million.
Image: Bigstock
Will Dismal Defense Deliveries Hurt Boeing's (BA) Q1 Earnings?
The Boeing Company’s (BA - Free Report) Defense, Space & Security segment is likely to record unimpressive 2024 revenues, owing to lower year-over-year deliveries of its defense products.
However, supply-chain constraints are likely to have had an adverse impact on the BDS segment’s earnings. Boeing’s first-quarter 2024 results are scheduled to be released on Apr 24.
Click here to know how the company’s overall performance might have been in the soon-to-be-reported quarter.
Steady Order Flow to Aid Backlog
With the U.S. administration spending significantly on the nation’s defense capabilities for the past few years, the Boeing Defense, Space & Security (BDS) unit has been witnessing solid order flow from the Pentagon, NASA and Congress for its varied products. Moreover, the diverse regional threats witnessed across Asia, Europe and the Middle East have also been offering growth opportunities for this unit’s products.
The Boeing Company Price and EPS Surprise
The Boeing Company price-eps-surprise | The Boeing Company Quote
Consequently, Boeing has been witnessing a solid global demand for its major combat programs, which translated into an overall order value of $8 billion for the BDS unit in the fourth quarter of 2023. Such solid order values thereby bolster the BDS segment’s backlog.
We expect the upcoming results to reflect a similar order count for the unit, thereby bolstering its backlog figure.
Have Dismal Deliveries Hurt Q1 Performance?
Boeing’s first-quarter defense delivery figures indicate a deterioration of 66.7% from the year-ago period’s level.
Its defense deliveries totaled 14, down from 42 in the prior-year quarter. Such dismal delivery figures are expected to have hurt the defense segment’s revenues in the soon-to-be-reported quarter. Nevertheless, increased sales from space and proprietary programs might have partially aided the BDS unit’s top-line performance.
The Zacks Consensus Estimate for the defense unit’s revenues is pegged at $6,379 million, indicating a decline of 2.4% year over year.
Earnings Prospect
Strong order activities in the previous quarters as well as lower charges from development programs, as BA progresses in these programs, are expected to have favorably contributed to BDS’ earnings performance.
However, persistent supply-chain constraints might have partially hurt BDS’ overall first-quarter earnings.
The consensus estimate for BDS’ earnings is pegged at a loss of $62.5 million, indicating a significant improvement from the year-ago quarter’s reported loss of $212 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 #1 (Strong Buy), #2 (Buy) or #3 (Hold) — increases the odds of an earnings beat. That is not the case here.
Boeing has an Earnings ESP of -15.87% and a Zacks Rank #5 (Strong Sell) at present. 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 of elements to post an earnings beat this reporting cycle.
Huntington Ingalls Industries Inc (HII - Free Report) is slated to release first-quarter results on May 2. HII has an Earnings ESP of +1.39% and a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Huntington Ingalls delivered a four-quarter average earnings surprise of 20.64%. The consensus estimate for first-quarter earnings is pegged at $3.49 per share, while that for sales is pinned at $2.80 billion.
Leidos Holdings (LDOS - Free Report) is scheduled to release first-quarter results on Apr 30. LDOS has an Earnings ESP of +1.86% and a Zacks Rank #2 at present.
Leidos delivered a four-quarter average earnings surprise of 11.85%. The Zacks Consensus Estimate for LDOS’ first-quarter earnings is pegged at $1.65 per share, while that for sales is pinned at $3.80 billion.
CurtissWright (CW - Free Report) is slated to report first-quarter results on May 1. CW has an Earnings ESP of +0.23% and a Zacks Rank #2 at present.
CW delivered a four-quarter average earnings surprise of 7.71%. The consensus mark for CW’s first-quarter earnings is pegged at $1.75 per share, while that for sales is pinned at $665 million.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.