Aircraft Nosedive Durable Goods
By Dirk van Dijk, CFA of Zacks.com
NEW YORK (TheStreet) -- Non-defense aircraft was the reason for the drop in new orders for durable goods, which fell by 1.3% in March, well below expectations for an increase of 0.1%.
Offsetting this were positive revisions to February, where new durable goods orders are now estimated to have risen by 1.1% instead of the original estimate of 0.9%. If transportation equipment orders are excluded, then new orders rose by 2.8%, far above the 0.7% expected rate. Orders for goods other than Transportation were also revised up sharply for February, to an increase of 1.7% from 1.4%.
So orders for non-defense aircraft are quite volatile. As Johnny Carson might have asked, "How volatile ARE they?" In March they were down 67.1%, which sort of makes it sound like Boeing (BA) is going out of business, until you consider that in February non-defense aircraft orders rose by 32.7% and in January they shot up by 134.9%. These are month to month changes that can give any analyst airsickness.
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