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Boeing Wins Order for Next-Gen 737-800 Jets from Jeju Air
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Leading commercial aircraft maker The Boeing Company (BA - Free Report) has received an order for three Next-Generation 737-800 airplanes from South Korea-based Jeju Air, Korea's first low-cost carrier which was established in 2005 and began operations in 2006.
Details of the Deal
The value of the airplanes at current list prices comes to nearly $300 million. In Dec 2016, Boeing's orders & deliveries website had attributed the order to an unidentified customer.
Although the airline has an all-Boeing fleet of nearly 26 Next-Generation 737-800s, this marks its first direct purchase from the aerospace giant. The new jets are in sync with Jeju Air’s widespread expansion strategy the fast growing air travel market in Asia.
A member of the Next-Generation 737 family, the 737-800 continues to be extremely popular as a single-aisle aircraft because of its advanced technology, and low operation and maintenance costs.
The new 737s will feature the Boeing Sky Interior – the 787 Dreamliner inspired cabin that provides passengers a sense of spaciousness with decorative sidewalls, larger windows, LED mood lighting, as well as larger pivot overhead stowage bins.
Single-Aisle Aircraft in Demand
Over the next 20 years, Boeing envisions demand for over 39,620 airplanes, valued at more than $5.9 trillion. About 38% of the total commercial demand is likely to come from the Asian markets. Single-aisle airplanes will comprise nearly 70.6% of the new deliveries, with airlines requiring over 28,140 jets of this category.
Boeing expects single-aisle jets to be the major driver of demand growth, comprising 71% of the total projection. While the new Boeing 737 MAX 8 and the 737-800 will likely grab a lion’s share of the new orders, Airbus Group SE’s (EADSY - Free Report) A320neo is expected to pose a significant competitive challenge.
Boeing’s 737 is one of the best-selling planes in the single-aisle market thanks primarily to its fuel efficiency and passenger comfort. To maintain its dominance in the commercial aerospace market, the company continues to invest in research and development to upgrade and churn out upgraded versions of its existing planes.
2016 Order Details
Looking at Boeing’s 2016 order details, the company has booked 668 net commercial orders (accounting for cancellations), valued at $94.0 billion at current list prices. The order includes 550 orders for the 737, followed by 58 for the 787.
Price Movement
Shares of Boeing have gained 1.2% over the last one month, underperforming the Zacks categorized Aerospace–Defense industry’s gain of 1.5%. This could be because Boeing continues to face challenges from uncertainties related to high-cost programs, risks related to key project executions, order cancellations and stiff competition.
Zacks Rank & Key Picks
Boeing currently carries a Zacks Rank #4 (Sell). A couple of better-ranked stocks in the same space include Lockheed Martin Corporation (LMT - Free Report) and Engility Holdings, Inc. .
Lockheed’s earnings beat estimates by 26.2% in the last reported quarter. The Zacks Consensus Estimate for 2017 moved up by 1.2% in the last 60 days to $12.63. Lockheed Martin sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Engility carries a Zacks Rank #2 (Buy). On an average, Engility has delivered a positive earnings surprise of 23.19% in the trailing four quarters. The company’s 2016 earnings estimates increased 13.4% over the last 60 days.
Zacks' Top 10 Stocks for 2017
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2017?
Who wouldn't? As of early December, the 2016 Top 10 produced 5 double-digit winners including oil and natural gas giant Pioneer Natural Resources which racked up a stellar +50% gain. The new list is painstakingly hand-picked from 4,400 companies covered by the Zacks Rank. Be among the very first to see it>>
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Boeing Wins Order for Next-Gen 737-800 Jets from Jeju Air
Leading commercial aircraft maker The Boeing Company (BA - Free Report) has received an order for three Next-Generation 737-800 airplanes from South Korea-based Jeju Air, Korea's first low-cost carrier which was established in 2005 and began operations in 2006.
Details of the Deal
The value of the airplanes at current list prices comes to nearly $300 million. In Dec 2016, Boeing's orders & deliveries website had attributed the order to an unidentified customer.
Although the airline has an all-Boeing fleet of nearly 26 Next-Generation 737-800s, this marks its first direct purchase from the aerospace giant. The new jets are in sync with Jeju Air’s widespread expansion strategy the fast growing air travel market in Asia.
A member of the Next-Generation 737 family, the 737-800 continues to be extremely popular as a single-aisle aircraft because of its advanced technology, and low operation and maintenance costs.
The new 737s will feature the Boeing Sky Interior – the 787 Dreamliner inspired cabin that provides passengers a sense of spaciousness with decorative sidewalls, larger windows, LED mood lighting, as well as larger pivot overhead stowage bins.
Single-Aisle Aircraft in Demand
Over the next 20 years, Boeing envisions demand for over 39,620 airplanes, valued at more than $5.9 trillion. About 38% of the total commercial demand is likely to come from the Asian markets. Single-aisle airplanes will comprise nearly 70.6% of the new deliveries, with airlines requiring over 28,140 jets of this category.
Boeing expects single-aisle jets to be the major driver of demand growth, comprising 71% of the total projection. While the new Boeing 737 MAX 8 and the 737-800 will likely grab a lion’s share of the new orders, Airbus Group SE’s (EADSY - Free Report) A320neo is expected to pose a significant competitive challenge.
Boeing’s 737 is one of the best-selling planes in the single-aisle market thanks primarily to its fuel efficiency and passenger comfort. To maintain its dominance in the commercial aerospace market, the company continues to invest in research and development to upgrade and churn out upgraded versions of its existing planes.
2016 Order Details
Looking at Boeing’s 2016 order details, the company has booked 668 net commercial orders (accounting for cancellations), valued at $94.0 billion at current list prices. The order includes 550 orders for the 737, followed by 58 for the 787.
Price Movement
Shares of Boeing have gained 1.2% over the last one month, underperforming the Zacks categorized Aerospace–Defense industry’s gain of 1.5%. This could be because Boeing continues to face challenges from uncertainties related to high-cost programs, risks related to key project executions, order cancellations and stiff competition.
Zacks Rank & Key Picks
Boeing currently carries a Zacks Rank #4 (Sell). A couple of better-ranked stocks in the same space include Lockheed Martin Corporation (LMT - Free Report) and Engility Holdings, Inc. .
Lockheed’s earnings beat estimates by 26.2% in the last reported quarter. The Zacks Consensus Estimate for 2017 moved up by 1.2% in the last 60 days to $12.63. Lockheed Martin sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Engility carries a Zacks Rank #2 (Buy). On an average, Engility has delivered a positive earnings surprise of 23.19% in the trailing four quarters. The company’s 2016 earnings estimates increased 13.4% over the last 60 days.
Zacks' Top 10 Stocks for 2017
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2017?
Who wouldn't? As of early December, the 2016 Top 10 produced 5 double-digit winners including oil and natural gas giant Pioneer Natural Resources which racked up a stellar +50% gain. The new list is painstakingly hand-picked from 4,400 companies covered by the Zacks Rank. Be among the very first to see it>>