Boeing Co (NYSE:BA) Is Likely To Keep Outperforming Its Peers

November 14, 2017, 13:51 pm ET, BY Simon M.- Contributor| Editor: Thomas H. Kee Jr. (Follow on LinkedIn)

This week, Boeing Co (NYSE:BA) and its peers are showcasing their latest aircrafts to potential clients, majority of which are airlines, the military and lessors. Boeing has so far outperformed its main rival, Airbus, having gotten an order for 40 Boeing 787-10 jetliners from Emirates Airlines at the Dubai Airshow.

Article Summary

Boeing is currently outperforming its main rival, Airbus, at the Dubai Airshow.

The company had a stellar third quarter report with high free cash flow levels.

The company’s is reporting increased sales for most of its Dreamliners.

Here’s the trading report on BA.

The company announced its third quarter results in late October where the company reported high levels of free cash flow and management reiterated its commitment to returning 100% of all future free cash flow to its shareholders. The company also raised its fiscal 2017 operating cash flow guidance with the company now expecting to generate $12.5 billion in free cash flow this year as opposed to its earlier estimate of $10.75 billion.

A significant portion of the free cash flow projected to be generated by the company will not come from the sales of new aircraft, but from the company’s newly isolated service business. The company is currently operating its services division as an independent entity, which is projected to generate annual revenues as high as $50 billion over the next decade.

The company is also on track to meeting the high demand for narrow body airplanes by ramping up the production of its 737 jetliner. The company is set to produce at least 57 of these jets each month by 2019. However, demand is still far outstripping supply and is projected to rise in the coming years.

Boeing also reported that order for the 777 were stabilizing given that the Dreamliner has been a big disappointment to the company recently, mainly due to falling orders. The company has cut its production volumes twice this year.

The company is also projecting that the global demand for jets is about 41,000 new jets over the next ten years, with China accounting for about 7,000 of the projected demand. The company’s CEO recently acknowledged that China is shaping up to become a very important market for the company.

The company is also projecting to have massive success with its mid-sized wide-body aircraft, the 797, especially for shorter city-to-city distances starting with the Middle East. The company continues to showcase its offering at the Dubai Airshow up to the 16^th where it is expected that the company will outperform most of its peers including its main rival, Airbus.

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