Boeing (BA) Stock Lower on Cost-Cutting Efforts
NEW YORK (TheStreet) -- Shares of Boeing (BA) - Get Report are down by 0.02% to $126.91 on Thursday afternoon, as the Seattle-based company steps up efforts to cut supply chain costs and reduce inventory, Reuters reports.
Boeing will take 120 days, rather than 30 days, to pay its vendors and it will reduce its factory inventory as well as rely on its suppliers to hold many of its plane parts, Reuters stated.
These inventory and payment changes are a result of airlines demanding more high-performing planes for cheaper costs.
In order to remain competitive, "we are in the process of adjusting the payment terms of our large suppliers. In most, if not all cases, our new payment terms are in line with their payment schedules to their own suppliers," Boeing Spokeswoman Jessica Kowal told Reuters.
Boeing is an aerospace firm which, under its various segments, develops and produces military and commercial airplanes.
"It's in Boeing's DNA to build the best airplanes. But what we and suppliers have to recognize is that we have to shift that dynamic and focus on reducing the cost to build the airplanes," Boeing's Kent Fisher, vice president of supplier management, said, according to Reuters.
Separately, TheStreet Ratings rated Boeing as a "buy" with a score of B.
This is driven by a number of strengths, which can be seen in multiple areas, such as its revenue growth, notable return on equity and good cash flow from operations. TheStreet Ratings feels its strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.
You can view the full analysis from the report here: BA
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.