The Boeing Co. Lands 3 Order Commitments While Caterpillar Inc. Falls Behind General Electric

Here are three Dow industrial juggernauts mixing it up today as the Dow trades higher.

Jul 14, 2014 at 3:00PM

The Dow Jones Industrial Average (DJINDICES:^DJI) is trading 120 points higher, or 0.71%, by midafternoon while investors wait for earnings season to kick into high gear. This week could provide insight into where the market is heading in the short term, with 59 S&P 500 companies scheduled to report quarterly earnings. If companies prove that growth has returned after the harsh winter hammered first-quarter reports, it could provide a boost to current stock prices.

S&P 500 profits are expected to grow 6.2% in the second quarter on a 3.1% increase in revenue, according to data compiled by Thomson Reuters.

With that in mind, here are some Dow components making headlines in the market today.

First up, Boeing (NYSE:BA) is announcing a handful of commercial aircraft order commitments today that will be posted on the Boeing orders and deliveries website when finalized.

Boeing and Avolon announced the leasing company's commitment for six 787-9 Dreamliner aircraft and another five 737 MAX 9 airplanes. At current list prices, the commitment is valued at more than $2 billion.


Monarch Airlines Selects Boeing as preferred bidder for fleet replacement. Source: Boeing

Also today, Boeing and Okay Airways announced an order for six 737 MAX 8s and four next-generation 737-800s. The commitment would be valued at roughly $980 million at current list prices. Okay Airways is the first privately owned airline in China and is also the first to operate the 737-900ER.

Boeing's most valuable commitment today confirms last week's rumors: Boeing and Monarch Airlines announced a commitment for 30 737 MAX 8s, valued at $3.1 billion at current list prices.

"Today's announcement is an important milestone in an exhaustive three-year evaluation process, and a key part of The Monarch Group's transformation and renewal," said Iain Rawlinson, executive chairman of The Monarch Group, in a press release. "Boeing truly understood our business and put together a complete package that fits extremely well with our ambitions for the Group. With this announcement, we begin another chapter in our long and fruitful relationship with Boeing, something which now stretches over 40 years."

As Boeing's massive backlog of orders continues to balloon, investors will be listening carefully to management's comments regarding the execution of accelerating production and deliveries during the aviation juggernaut's second-quarter call next week.

Another Dow component, Caterpillar (NYSE:CAT), is making noise today after The Wall Street Journal reported it has fallen far behind General Electric in railroad locomotive innovation. Caterpillar's Electro-Motive Diesel unit won't have locomotives available until 2017 to comply with stricter emission standards taking effect next year. That's far behind General Electric (NYSE:GE), which is already testing locomotives that will comply with diesel-engine exhaust regulations taking effect next year.

For those keeping track, General Electric already owns an estimated 60%-70% of the U.S. locomotive market -- and its share will likely increase if General Electric's diesel locomotive hits the market ahead of Caterpillar's competing product.

This isn't something for investors to worry about in the short term. However, it's certainly not encouraging to hear that Caterpillar, a company that prides itself on producing heavy machinery and equipment, is falling behind in terms of innovation. Caterpillar has since downplayed the importance of this development, although it also commented that it intends to speed up its working schedule on its diesel locomotives.

Caterpillar is expected to report its most recent quarterly earnings before market open on July 24.

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Daniel Miller has no position in any stocks mentioned. The Motley Fool owns shares of General Electric Company. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

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Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

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KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

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David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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