Despite US Air Carriers Issues, Boeing Guidance Mostly Strong (BA)

Boeing Co. (NYSE: BA) posted a 38% profit gain of $1.2 billion on a 4% revenue gain to $16 Billion in Q1-2008, and its numbers come to $1.62 EPS.  First Call had estimates of $1.35 EPS on $16.5 Billion.

Here is where this gets tricky, or at least where it is surprising.  The airplane giant has put 2008 EPS guidance as being reaffirmed at between $5.70 and $5.85 EPS (Fist Call is $5.93 EPS) and 2009 EPS expected to grow approximately 20% to between $6.80 and $7.00 EPS (First Call is $6.87 EPS). 

Despite some softness or not being above estimates, this is extremely strong considering the woes of the US airline industry as high oil prices are killing earnings.  Its contractual backlog of orders grew to a new record of $271 billion, and its total backlog is $346.1 Billion. 

What is amazing here is that the US airlines’ woes are not yet bleeding over to Boeing.  International markets are strong, but from an outsider’s view this one looks like even though it is under on guidance that the numbers are going to be hard to hit after all the 787 Dreamliner delays.  Either the new planes are going to help airlines bring on more passengers, or these airline woes will spill over into their upgrades.  Maybe those old $20 per ticket oil surcharges will go up to $100.

Boeing shares are up 2% at $80.39 pre-market on a relief rally, and the 52-week trading range is $71.59 to $107.83.

Jon C. Ogg
April 23, 2008