Boeing tops profit expectations as revenue falls
Boeing Co's (BA-N) first-quarter profit rose 13 percent, topping Wall Street expectations, and the company reaffirmed its full-year outlook that reflects an ongoing recovery in the commercial aerospace industry.
The company also said its total order backlog grew in the quarter.
"I think people are getting comfortable with the valuation, and people are getting comfortable with the recovery," said Alex Hamilton, managing director of EarlyBirdCapital.
"What is clear is that this recovery is ongoing," he said.
The world's largest aerospace and defense company said Wednesday its first-quarter profit came to $586 million US, or 78 cents per share, compared with $519 million, or 70 cents per share, a year earlier when the company took a 20 cents-per-share charge related to health care legislation.
Analysts on average expected Boeing to report a first-quarter profit of 70 cents per share, according to Thomson Reuters I/B/E/S.
Revenue slipped 2 percent to $14.9 billion. Boeing said its total backlog grew to $329 billion during the quarter.
Boeing reaffirmed its 2011 financial outlook, and said it expects revenue in a range of $68 billion to $71 billion.
Boeing, which competes with EADS unit Airbus for orders, splits its business almost evenly between commercial airplanes and defense products. But the stock tends to track commercial airplane orders and deliveries more closely.
The commercial airplane industry is recovering from a global economic downturn that saw cash-strapped airlines curb orders in recent years.
Boeing this month said it delivered 104 commercial aircraft in the first quarter, including 87 next-generation 737s, four 767 wide-bodies and thirteen 777s. Aircraft manufacturers only get paid on delivery, usually at least 18 months after purchase.
Boeing Commercial Airplanes' (BCA) first-quarter revenue decreased by 5 percent to $7.1 billion on planned lower 777 deliveries. BCA's backlog totaled more than 3,400 airplanes valued at $263 billion, the company said.
Boeing repeated that first delivery for the long-delayed 787 Dreamliner was on track for the third quarter.
Boeing has taken about 835 orders from 56 customers for the light-weight carbon composite aircraft, which is about three years behind its original schedule due to labor problems and snags in the global supply chain.
Boeing also said delivery of the first 747-8 Freighter is still planned for mid-2011.
"BCA is still well placed, with production rates heading higher, strong order inflow and no further blow-ups this quarter on its development programs," said RBC Capital Markets analyst Robert Stallard in a research note.
Boeing Defense, Space & Security's first-quarter revenue was $7.6 billion, in line with the year-ago quarter. Earlier this year, Boeing snared a $30 billion Pentagon order 179 U.S. Air Force refueling planes.