The international commercial airplane producer, The Boeing Co. (BA) maintained its delivery level in the first quarter of 2011 with deliveries of 104 airplanes versus 108 in the first quarter of 2010.
Boeing is on course to meet its commercial airplane delivery target for 2011, which is expected to be in the range of 485 to 500 airplanes. The guidance also includes the expected delivery of the first 787 and 747-8 models, starting from the third quarter, and together accounting for 25 to 40 airplanes.
The commercial airplane market is showing gradual signs of improvement, as reflected in the order books of the commercial airplane manufacturer. The gross order received by the company in the first quarter of 2011 was 153 airplanes versus 100 airplanes in the year-ago period.
The 737 model continues to be a major pillar of Boeing’s strength in the commercial airplane sector, followed by its 777 model. Both these models continue to do well due to their fuel efficiency and lower operating costs compared to competing models.
Boeing’s closest international peer in the commercial airplane market is France based Airbus. Airbus outpaced Boeing when it received an order from Indian low cost carrier Indigo for 180 eco-efficient Airbus A320 aircraft of which 150 will be A320neo’s and 30 will be A320s. However, Boeing is gradually catching up with its successive order wins for its commercial models.
Boeing expects commercial airplanes to generate revenues in the range of $36 billion to $38 billion in 2011, exceeding the 2010 level of $31.8 billion. However, the delay in delivery of the 787 Dreamliner continues to remain a cause of concern besides the cancellation of order for 12 787’s in the first quarter 2011.
Chicago-based Boeing Co. currently has a Zacks #3 Rank (short-term Hold rating). We also maintain a long-term Neutral rating on the stock. The company competes with the likes of General Dynamics Corp. (GD), Lockheed Martin Corporation (LMT) and Northrop Grumman Corporation (NOC).
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