Boeing Clinches $300M Deal from UK - Analyst Blog

By Zacks Equity Research,

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The Boeing Company ( BA ) has entered into a $300 million sales agreement with the United Kingdom under which the former will provide equipment, services and maintenance to support Britain's C-17 cargo aircraft.

Per the sales agreement, the Boeing Company will supply 20 F-117-PW-100 engines, engine exchange kits, global positioning systems, communications and support equipment, spare and repair parts, personnel training, and technical documents to support UK's fleet of eight Boeing C-17A GLOBEMASTER III aircraft. It will also provide engineering, technical and logistics support services for the aircraft.

The UK was the first foreign customer for the C-17 GLOBEMASTER III cargo aircraft. The Boeing C-17 Globemaster III is a large military transport aircraft. The C-17 is used for rapid strategic airlift of troops and cargo to main operating bases or forward operating bases throughout the world. It can also perform tactical airlift, medical evacuation and airdrop missions.

Going forward, the company plans to continuously focus on disciplined increases in production rates for commercial airplane customers. Boeing also intends to build on its strong position in defense, space and security with aggressive pursuit of growth and profitability in core, adjacent and international markets. The global demand for the company's other products and services remains solid, particularly in international markets like the Middle East and South Asia.

We believe that The Boeing Company is among the best-positioned in its sector due to its balanced exposure to commercial aircraft and defense equipment. Also, the U.S. defense budget is skewed towards a number of prominent Boeing programs. However, in the near term, challenges confronting the global airline industry along with expected cutbacks in the U.S. defense budget loom large over the current valuation of the company.

The company presently retains a short-term Zacks #3 Rank (Hold) that corresponds with our long-term Neutral recommendation on the stock.

Headquartered in Chicago, The Boeing Company is a premier jet aircraft manufacturer and one of the largest defense contractors in the U.S. The company's customers include domestic and foreign airlines, the U.S. Department of Defense, the Department of Homeland Security, the National Aeronautics and Space Administration, other aerospace prime contractors, and certain U.S. government and commercial communications customers. The company mainly competes with Lockheed Martin Corporation ( LMT ) and Northrop Grumman Corporation ( NOC ).

BOEING CO ( BA ): Free Stock Analysis Report
LOCKHEED MARTIN ( LMT ): Free Stock Analysis Report
NORTHROP GRUMMN ( NOC ): Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , Business , Stocks
Referenced Stocks: BA , LMT , NOC

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