Boeing (BA) - Get The Boeing Company Report continues to struggle with its 787 Dreamliner, generating zero deliveries in December for the second month in a row as mechanics continue to scour the plane for problems.
Boeing saw 107 orders canceled last month. They included 105 737 MAX planes and two Dreamliners. The MAX was cleared to fly in November by U.S. regulators after being grounded since March 2019.
Boeing lost 641 orders for the MAX last year. The company delivered just 53 Dreamliners in 2020, down two-thirds from 158 in 2019. Boeing had 184 orders for all of last year, including 130 for the MAX.
Boeing shares at last check were trading at $206.30, down 0.2%. They have slumped 38% in the past 12 months. The S&P 500 has climbed 15% in the same period.
Morningstar analyst Burkett Huey puts fair value at $260 and gives Boeing a wide moat.
“While the resumption of U.S. 737 MAX deliveries is a critical step, aircraft are sold globally, and the plane remains grounded in Europe and China, the two other major aviation markets,” he wrote in a November commentary.
“We’ve seen optimistic news out of Europe that the MAX is well on its way to returning to service and may receive authorization to resume operations by the end of the year.
"We are unsure of its progress in China, and we worry that it might be used as a tool in the escalating tensions between the U.S. and Chinese governments.”
Last week, Boeing said it's paying $2.5 billion to the Justice Department to settle fraud and conspiracy charges linked to the MAX. Prior to its grounding, two MAX jets crashed, killing 346 people. The crashes involved mechanical issues for the plane.
Boeing said it already set aside $1.77 billion for costs related to settlement and will use that money to compensate its customers for the losses resulting from the MAX's grounding.