The Boeing Company Earnings: Tops Analysts’ Expectations

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S&P 500 (NYSE:SPY) component The Boeing Company (NYSE:BA) reported net income above Wall Street’s expectations for the first quarter. Boeing is an aerospace firm that designs, develops, manufactures, sells, and supports commercial jetliners, military aircraft, satellites, missile defense, and human space flight services.

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The Boeing Company Earnings Cheat Sheet for the First Quarter

Results: Net income for the aerospace/defense rose to $923 million ($1.22 per share) vs. $586 million (78 cents per share) in the same quarter a year earlier. This marks a rise of 57.5% from the year-earlier quarter.

Revenue: Rose 30% to $19.38 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: The Boeing Company beat the mean analyst estimate of 95 cents per share. It beat the average revenue estimate of $18.34 billion.

Quoting Management: “Strong core operating performance from our production programs and services businesses continues to drive expanded earnings, revenue and cash flow for Boeing,” said Jim McNerney, chairman, president, and chief executive officer.  “We also grew our record backlog with more than 300 firm orders for our new 737 MAX, a contract award for 84 new F-15s for Saudi Arabia, and other key wins.”

Key Stats:
Boeing has now seen net income rise in three straight quarters. In the fourth quarter of the last fiscal year, net income rose 19.7% and in the third quarter of the last fiscal year, the figure rose 31.2%.

Boeing has now topped analyst estimates for the last four quarters. It beat the mark by 29 cents in the fourth quarter of the last fiscal year, by 35 cents in the third quarter of the last fiscal year, and by 28 cents in the second quarter of the last fiscal year.

Gross margin shrank 2.1 percentage points to 17.1%. The contraction appeared to be driven by increased costs, which rose 33.4% from the year earlier quarter while revenue rose 30%.

Revenue has increased for four consecutive quarters. Revenue increased 18.2% to $19.55 billion in the fourth quarter of the last fiscal year. The figure rose 4.5% in the third quarter of the last fiscal year from the year earlier and climbed 6.2% in the second quarter of the last fiscal year from the year-ago quarter.

Looking Forward: Over the past ninety days, the average estimate for the second quarter has fallen from $1.20 per share to $1.08, indicating that analysts are growing pessisimistic about the company’s performance next quarter. For the fiscal year, the average estimate has moved down from $4.90 a share to $4.47 over the last ninety days.

Competitors to Watch: Lockheed Martin Corp., Embraer SA, Raytheon Company, Northrop Grumman Corp., Honeywell Intl. Inc., Spirit AeroSystems Hldgs., Inc., General Dynamics Corp., Orbital Sciences Corp., Alliant Techsystems Inc., and Rockwell Collins, Inc.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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