Boeing (BA) Stock Drops, Will Take $2.1B Charge From Jet Programs

Boeing (BA) stock is slumping on Friday morning after the company said it would take $2.1 billion in charges in its 2016 second quarter earnings.
By Kaya Yurieff ,

NEW YORK (TheStreet) -- Shares of Boeing (BA) - Get Report are down 1.75% to $131.19 on Friday morning after the company said it would record $2.1 billion in charges in its 2016 second quarter earnings.

The pretax charges are related to delays and developing its new Air Force refueling tanker, demand concerns about its largest jetliner, the 747 jumbo, and the high costs of its 787 Dreamliner, its most advanced jetliner, the Wall Street Journal reported.

The charges are expected to erase $3.23 per share in second quarter earnings, due out July 27.

"These are the right, proactive decisions to strengthen our business going forward," CEO Dennis Muilenburg said in a statement after yesterday's market close.

Chicago-based Boeing continues to face long-term challenges, such as declining demand for twin-aisle jets, pressure on its jet prices and retreating market share against European and Canadian rivals for its lucrative single-aisle 737 jetliners, the Journal noted.

Separately, TheStreet Ratings Team has a "Buy" rating with a score of B on the stock.

The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity and good cash flow from operations.

The team believes its strengths outweigh the fact that the company has had sub par growth in net income.

Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.

You can view the full analysis from the report here: BA

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