What happened

Boeing (NYSE:BA) stock jumped nearly 7% in early trading Wednesday after reporting record results for fiscal 2017 -- and giving new guidance for 2018 far above what Wall Street had been expecting. The stock has given back some of those gains as of 3:35 p.m. EST, but the shares are still up 4.7%.

For fiscal Q4 2017, Boeing earned $5.18 per share and said its "core earnings per share" were $4.80 -- much more than the $2.91 per share that analysts had expected it to earn. Quarterly sales of $25.4 billion likewise exceeded Wall Street's expectations.

Boeing 737 head on

Image source: Getty Images.

So what

Boeing Chief Executive Officer Dennis Muilenburg summarized the quarter thusly: "Across Boeing our teams delivered a record year of financial and operational performance." And indeed, Boeing's improvement over last year's Q4 (itself not a weak quarter by any means) was striking. Per-share profits of $5.18 in Q4 2017 were literally twice what Boeing earned a year ago, and sufficient to lift full-year GAAP profit to $13.43 per share (up 76% over full-year 2016 earnings). Sales were down 1% for the year, but up 9% for the quarter.

Operating profit margin continued a long-term trend of steady growth, rising 250 basis points (to 11.9%) in Q4, and rising 450 basis points (to 11%) for the year.

Now what

Anticipating even more growth in the year ahead, Boeing announced new guidance for the coming fiscal year. In 2018, Boeing expects to earn between $15.90 and $16.10 per share in profit on sales of $96 billion-$98 billion, maintaining an operating profit margin of 11% or better in both its commercial airplanes and defense and space and security businesses.

Core earnings per share -- the number Wall Street will presumably focus on -- should range between $13.80 and $14. Free cash flow (my own preferred metric) should approximate $12.8 billion (up 10% year over year), giving Boeing a price-to-free-cash-flow ratio of only 16.6, assuming Boeing hits its target.

Investors are right to be enthused.

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