Is Boeing Destined for Greatness?http://www.fool.com/investing/general/2013/07/06/is-boeing-destined-for-greatness.aspx Alex Planes
July 6, 2013
Investors love stocks that consistently beat the Street without getting ahead of their fundamentals and risking a meltdown. The best stocks offer sustainable market-beating gains, with robust and improving financial metrics that support strong price growth. Does Boeing (NYSE: BA) fit the bill? Let's take a look at what its recent results tell us about its potential for future gains.
What we're looking for
What the numbers tell you
How we got here and where we're going
Boeing has been working hard to increase production of its fast-selling commercial jets, and the company is beginning to see its efforts rewarded. Boeing has delivered 169 planes in the second quarter, making 306 complete deliveries for the year. About 70% of these were Boeing's 737 Next Generation, a narrow-body jet due to completely replace the 737 in 2017. The 737 is Boeing's most popular jet, and the company is in the process of boosting production from 35 to 48 jets per month.
The second quarter also saw Boeing resume delivery of its flagship 787 Dreamliner after working through some scary technical issues. Boeing delivered 16 more Dreamliners in the second quarter. At a list price of over $200 million, the Dreamliner is big business for Boeing. The company is aggressively trying to raise production rates on the Dreamliner to 10 planes per month. Boeing has beaten its chief competitor Airbus on total commercial deliveries for the year to date, which is a good sign that its Dreamliner problems have not caused a production bottleneck.
Boeing also announced a new, larger version of the Dreamliner at the Paris Air Show last month. Initial orders have already rolled in from several airlines -- United Continental (NYSE: UAL) signed up to buy 20 of the new birds, and Air Lease (NYSE: AL) and Singapore Airlines both plunked down a big order for 30 of the larger Dreamliners apiece. The updated 787-10 Dreamliner attacks the Airbus A350's target market, and is expected to offer better fuel efficiency than the comparable Airbus jet. However, EasyJ