Boeing Reports $6B Loss in Q3: Analysts Weigh in on Future

Troubled aerospace giant Boeing Co. (BA) announced a significant loss of $6 billion for the third quarter, marking its largest loss since 2020. This downturn occurs amidst ongoing labor strikes and efforts aimed at company-wide restructuring. Analysts have provided insights into the company's current challenges and potential future directions.

Analyst Insights

BofA Securities analyst Ronald Epstein commented on the market's muted reaction to Boeing's earnings report, indicating that investors believe "this is the bottom" for the company, while also suggesting there may be undisclosed issues yet to surface. Epstein highlighted that a major step towards restoring Boeing's former success is resolving the ongoing labor strike, which is costing the company about $50 million a day. Epstein estimates that a protracted strike lasting 58 days could lead to financial losses nearing $3 billion.

According to BofA analysts, stabilizing Boeing's balance sheet is crucial in facilitating its recovery. They have projected that the company could raise between $18 billion and $20 billion through its recent mixed shelf offering. Additionally, Boeing is reportedly contemplating the sale of non-essential assets, which analysts view positively as it would help reduce debt and strengthen the balance sheet. Epstein noted that this step could help mitigate cash burn while allowing Boeing to refocus its operations during the transformation process.

Future Projections

RBC Capital Markets analyst Ken Herbert indicated that the anticipated negative free cash flow for Boeing in 2025 was a focal point during the earnings call. RBC has adjusted its projections to approximately negative $8 billion for 2025 and negative $2.6 billion for 2026, with expectations for a rebound to positive free cash flow in the latter half of 2026. Herbert remarked that CEO Ortberg's initial comments were cautious, with investors expecting clearer timelines for returning to pre-strike production levels. Despite these challenges, Herbert remains hopeful about Ortberg's ability to steer Boeing back on course.

RBC Capital has maintained its Outperform rating on Boeing, setting a price target of $200 for the stock.

Boeing's Stock Performance

As per market reports, Boeing shares closed 1.18% lower at $155.20 following the earnings report.

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