Boeing Co (BA) said that it did not receive a single order in April, while it was also grappling with 108 order cancelations for its grounded 737 MAX plane.
Last month, the ailing plane maker delivered 6 planes adding up to a total of 56 in first four months of this year, which represents a 67% decline year-on-year, as air travel demand has been halted in an effort to contain the coronavirus pandemic.
The planemaker’s stock dropped 2.7% to $125.22 in U.S. trading on Tuesday, taking its year-to-date plunge to more than 60%.
The April cancellations of its 737 MAX jets were from clients including China Development Bank Financial Leasing Co and General Electric’s (GE) aircraft unit GECAS.
Commercial airline travel has fallen off a cliff due to coronavirus-induced lockdown restrictions forcing many airlines around the world to ground the majority of their fleets and suspend aircraft deliveries. Boeing is cutting 10% of its workforce and announced reductions in its plane production rates as it braces for years-long industry recovery from the aviation crisis.
Following the report, five-star analyst Cai von Rumohr at Cowen & Co. maintained the stock’s Hold rating with a $150 price target
“BA is seeing some improvement in circumventing travel restrictions, but they likely will remain an issue in May,” Von Rumohr wrote in a note to investors.
TipRanks data shows that overall Wall Street analysts are cautiously optimistic on Boeing shares. The Moderate Buy consensus is based on 11 Holds and 6 Buys and 1 Sell. The $163.18 average price target implies 30% upside potential in the stock in the next 12 months. (See Boeing’s stock analysis on TipRanks).
Boeing CEO Dave Calhoun warned this week that he is anticipating a slow recovery for airline traffic over the coming months, and that this could result in one of the major airlines “folding”, according to a NBC interview.
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