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The Boeing Company (BA) Q4 Earnings Preview: Electric Shock Therapy?

 January 28, 2013 03:24 PM

(By Rich Bieglmeier) The Boeing Company (BA) is scheduled to report earnings before the market open on Wednesday, January 30, 2013 with the conference call slated for 10:30 a.m. ET. Wall Street anticipates that BA will earn $1.19 for its fourth quarter. iStock expects the airplane maker to report earnings that will exceed Wall Street's consensus number. The iEstimate is $1.28– a 9 cents upside surprise.

The Dow member engages in the design, development, manufacture, sale, and support of commercial jetliners, military aircraft, satellites, missile defense, human space flight, and launch systems and services worldwide. Their Dreamliner is in the news for all the wrong reasons of late. Boeing's 787 have been grounded since mid-January due to electrical problems.

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BA has managed earnings expectations fairly well managed for the past four years. Seventy-five percent of Boeing's last 16 earnings announcements produced bullish surprises, topping the street's consensus number by an average of 18.22%. Meanwhile, on four occasions, BA missed the mark by 10.21% on average.

By most measures, minus electrical problems, 2012 was a good year for Boeing. According to Aviation Week, "Boeing booked 1,203 net orders in 2012, second only to the 1,413 of 2007, and benefited by a spurt of December deliveries, including 15 in one 24-hr. period, to reach 601 for the year." The article finished with, "Boeing recorded 1,339 gross orders for the year but had 136 cancellations. All its programs were in the black for net orders except the 787, which was down 12 aircraft."

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The company had a good year delivery wise, as well. The company's website shows 1,356 total commercial and Defense, Space & Security Programs deliveries for 2012, versus 1,073 for 2011. Fourth quarter 2012 versus 2011 produced an increase of 40 deliveries year-over-year, from 160 in Q4 2011 to 200 in Q4 2012. However, BA delivered only one more plane in Q4 2012 compare to Q3 2012, 200 versus 199.

In 2011, Boeing earned $1.83 on expectations of $1.01 of the fourth quarter. Three months ago, BA produced eps of $1.35 versus the consensus of $1.13.

Based on orders and deliveries, iStock anticipates that The Boeing Company (BA) will surpass the street's expectation, once again, on Wednesday morning. Although our iEstimate is at $1.28, we wouldn't be surprised to see a result similar to Q3's $1.35. The big question that needs to be answered, however, is to what degree the Dreamliner's electrical problems will hamper future quarters.



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