Boeing Company (BA) to Beat Earnings on Higher Deliveries - Analyst Blog


The Boeing Company ( BA ) is slated to release second quarter 2014 financial results before the market bell on Jul 23, 2014. The company posted a positive earnings surprise of 14.29% in the preceding quarter. Let's see how things are shaping up prior to this announcement.

Growth Factors This Quarter

Boeing continued its steady performance in the second quarter, with commercial deliveries of 181 airplanes and assorted defense deliveries of 47 products surpassing the comparable year-ago numbers by 7% and 51% respectively.

The gradual recovery in the global economy brought with it a steady rise in passenger and freight traffic. Boeing stands to benefit from this commercial airplane market revival on the strength of its fuel efficient, constantly evolving airplane models.

A study from Boeing projected long-term demand (2014-2033) for 36,770 commercial airplanes out of which the majority will be for fuel efficient single aisle aircraft. Boeing 737 is a front runner in the single aisle aircraft market. In the second quarter the company received orders for 275' 737 airplanes.

Boeing's Defense, Space & Security division is also doing well, with orders coming in from its global customer base. During the quarter the company supplied its defense products to Canada, Mexico, India and the Republic of Korea among others.

In the to-be-reported quarter Boeing made two strategic acquisitions, namely, Ventura Solutions Inc., a hardware and software engineering company and AerData Group B.V., a provider of technical services for aircraft and engine operators. These acquisitions will further enhance Boeing's product offering.

Earnings Whispers

Our proven model conclusively shows that Boeing is likely to beat earnings this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1, 2 or 3 for this to happen. This is the case here.

Positive ESP :  This is because the Most Accurate estimate stands at $2.03 while the Zacks Consensus Estimate is $2.02, resulting in +0.50% ESP.

Zacks Rank #3 : Boeing's Zacks Rank #3 combined with a +0.50% ESP indicates that the company is going to beat the earnings forecast this quarter

Other Stocks to Consider

Here are some other companies in the aerospace and defense space having the right combination of elements to post an earnings beat this quarter.

B/E Aerospace Inc. ( BEAV ) has an earnings ESP of +1.85% and carries a Zacks Rank #2 (Buy).

Northrop Grumman Corp. ( NOC ) has an earnings ESP of +1.36% and carries a Zacks Rank #2 (Buy).

General Dynamics ( GD ) has an earnings ESP of +1.14% and carries a Zacks Rank #3 (Hold).

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

BOEING CO (BA): Free Stock Analysis Report

NORTHROP GRUMMN (NOC): Free Stock Analysis Report

GENL DYNAMICS (GD): Free Stock Analysis Report

B/E AEROSPACE (BEAV): 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 The NASDAQ OMX Group, Inc.

This article appears in: Investing , Business , Earnings , Stocks

Referenced Stocks: BA , NOC , GD , BEAV

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