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Boeing Reclaims 50-Day Line, Works On Flat Base
By: Investor's Business Daily
Boeing 's ( BA ) stock and its dividend have climbed this year even after its fleet of 787 Dreamliners was grounded due to battery problems.
The stock is up almost 40%, far outpacing the S&P 500. Its annual dividend yield stands at 1.9% at the current share price, below the S&P average of 2.54% but still impressive considering the strong capital gains.
Boeing's new, fuel-efficient 787s were idled for months starting in January after lithium-ion batteries overheated. Also, two of Boeing's 777 jetliners experienced engine failure earlier this year.
Yet orders for the 787 remain strong, and the company has said the cost of grounding the Dreamliners was small. Boeing said in May it was speeding up production of 787s, and news reports Thursday said Ethiopia Airlines remained committed to buying eight more Dreamliners even after one of its planes caught fire in London last month.
"The airplane is undergoing a challenging time to mature, but it's improving," CEO Tewolde Gebremariam was quoted as saying.
Also Thursday, Canada-based Westjet Airlines said it would buy 65 Boeing 737 aircraft. Boeing said the order is worth $6.3 billion.
Boeing's profit is expected to rise 15% in Q3 to $1.55 a share. That would be the biggest increase in six quarters. Revenue is expected to increase 8%, down slightly from Q2's 9% gain.
The stock is currently working on a flat base with a possible 109.59 buy point. It reclaimed its 50-day moving average Thursday.
Boeing has also resumed increasing its dividend after holding it steady from 2009 through 2011. The latest increase was announced in February, a 10% hike to 48.5 cents a share, or $1.94 annually.