Boeing (BA.US) is down more than 6% and trading at $200.50 per share as the plane manufacturer informed the public about tail-fitting flaw in popular single-aisle jet spurs. The issue is concerning as the 737 Max jet model production will affect already concluded agreements. The information came to the public late Thursday and the company admits it expects deliveries to decline in the near-term as it inspects affected aircraft. The faulty parts come from Spirit AeroSystems Holdings - also a public company that currently is down as much as 18%.
According to analysts calculations, this year production output could be reduced even by 20% from its current level of 425 planes. This could lower free cash flow for Boeing by nearly $800 million. For comparison, the company reported $2.29 billions of Free Cash Flow for 2022. Boeing stated that it is working to learn the extent of the problem.
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In 2022 company reported $66.6 billions in revenue, business operation was unprofitable which resulted with negative EBITDA at $-2.6 billions and net income equals to $-6.5 billions. Boeings also increased its debt significantly over the last four years. In 2019 the total debt was $28.5 billions, in 2020 $64.9 billions. From that time the company's debt tends to decrease slightly YoY and in 2022 was equal $58.5 billions.
Market cap: $120.5 billions
BA.US stock price is declining in reaction to the negative news released by the company. On the longer timeframe price is struggling to break significant support and is not even near ATH above $400. What is more, the last price action suggests that bullish momentum is fading. This is reflected on the MACD indicator where a divergence occurs - marked with blue lines on the MACD chart and Boeing price chart. Source: xStation5
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