Boeing scored its first 737 jet order this year, while cancellations for the grounded aircraft continue as travel restrictions tied to the coronavirus pandemic have throttled commercial jet demand.
Boeing’s (BA) monthly data for August showed that this year’s first MAX order was from Poland’s Enter Air, for two 737-8 aircraft and another order for 3 of the jets was booked by an unidentified customer. The 737 MAX has been grounded for more than a year after two fatal crashes. Meanwhile, the ailing plane maker said that last month 17 of its 737 MAX aircraft were cancelled out of a total of 20 aircraft cancelations. Airlines canceling MAX orders included AerCap, Aviation Capital Group, and Icelandair. The number of cancellations so far this year came to about 445.
Overall, Boeing received a total of 8 new orders taking the year-to-date figure to 67. The planemaker delivered 13 planes in August adding up to 87 aircraft so far this year. Deliveries last month included five widebody freighters, of which two are 767 freighters for FedEx, and three are 777s going to DAE Ireland, Lufthansa Cargo and FedEx.
Shares in BA have plunged 51% year-to-date as the coronavirus travel restrictions have resulted in a deep cut in the number of commercial jets and services Boeing customers need over the next few years. As such, global airlines suffering billions of dollars in losses have been seeking to cancel or delay some of the orders they have with Boeing.
Following the data, Cowen & Co analyst Cai Rumohr reiterated a Hold rating on the stock with a $150 price target (6.9% downside potential), noting that BA’s orders, deliveries, and backlog continue to lag rival Airbus by a wide margin. (See BA stock analysis on TipRanks)
“Customer deferrals remain the key issue as customers push out accepting 787 deliveries given international travel remains depressed,” Rumohr wrote in a note to investors.
The rest of the Street has a cautiously optimistic Moderate Buy consensus on the stock. That’s with a $181.63 average analyst price target (13% upside potential).
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