Boeing (BA) Q4 Earnings Lag Estimates, Revenues Decline Y/Y
The Boeing Company BA incurred adjusted loss of $15.25 per share for fourth-quarter 2020, much wider than the Zacks Consensus Estimate of a loss of $1.78. Moreover, the bottom line deteriorated from the year-ago quarter’s loss of $2.33.
Including one-time items, the company posted GAAP loss of $14.65 per share compared with a loss of $1.79 incurred in the fourth quarter of 2019.
The year-over-year deterioration can be attributed primarily to revenue decline along with poor operational performance in the reported quarter.
For 2020, the company reported adjusted loss of $23.25 per share, which came in wider than the Zacks Consensus Estimate of a loss of $9.71. Also, the bottom line deteriorated from 2019’s adjusted loss of $3.47 per share.
The Boeing Company Price, Consensus and EPS Surprise
The Boeing Company price-consensus-eps-surprise-chart | The Boeing Company Quote
Revenues
In the quarter under review, Boeing’s revenues amounted to $15.30 billion, which beat the Zacks Consensus Estimate of $15.26 billion by 0.3%. The top line however declined 15% from the year-ago quarter’s figure of $17.91 billion.
This decline was due to lower year-over-year revenues registered by the company’s Commercial Airplanes and Global Services business units.
For 2020, the company recorded revenues worth $58.16 billion, which missed the Zacks Consensus Estimate of $58.34 billion. Full-year revenues also deteriorated from 2019’s $76.56 billion.
Total Backlog
Backlog at the end of fourth-quarter 2020 dropped to $363.4 billion from $393.1 billion at the end of third-quarter 2020.
Segmental Performances
Commercial Airplane: Revenues at this segment plunged 37% to $4.73 billion due to lower widebody delivery volume on account of COVID-19 impacts as well as 787 production issues. The segment incurred operating loss of $7.65 billion compared with loss of $2.84 billion in the year-ago quarter.
Boeing delivered 59 commercial planes during the quarter under review, down 25% year over year.
Backlog for this segment remained healthy with over 4,300 airplanes valued at $282 billion.
Boeing Defense, Space & Security (BDS): This segment recorded revenues worth $6.78 billion in the fourth quarter, reflecting 14% year-over-year improvement, primarily driven by higher volume on fighter programs.
Meanwhile, this unit generated operating income of $502 million, compared with $34 million in the year-ago quarter.
Backlog at BDS was $61 billion, 32% of which comprised orders from international clients.
Global Services: Revenues at this segment declined 20% to $3.73 billion on account of lower commercial services volume thanks to COVID-19 impacts. Moreover, this unit generated operating income of $143 million compared with $684 million in the year-ago quarter.
Boeing Capital Corporation (BCC): This segment reported quarterly revenues of $56 million compared with $37 million registered in the year-ago quarter.
At the end of fourth-quarter 2020, BCC's portfolio balance was $2 billion.
Financial Condition
Boeing exited 2020 with cash and cash equivalents of $7.75 billion, and short-term and other investments of $17.84 billion. At the end of 2019, the company had $9.49 billion of cash and cash equivalents, and $0.54 billion of short-term and other investments. Long-term debt amounted to $61.90 billion at the end of 2020, significantly up from $19.96 billion at 2019 end.
Boeing’s operating cash outflow at the end of 2020 was $18.41 billion compared with $2.45 billion at the end of 2019.
Free cash outflow totaled $19.71 billion at the end of 2020 end compared with $4.28 billion at the end of 2019.
Zacks Rank
Boeing currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Defense Releases
Raytheon Technologies Corporation’s RTX fourth-quarter 2020 adjusted earnings per share (EPS) of 74 cents outpaced the Zacks Consensus Estimate of 71 cents by 4.2%.
Lockheed Martin LMT reported fourth-quarter 2020 earnings from continuing operations of $6.38 per share, which came in line with the Zacks Consensus Estimate.
An Upcoming Defense Release
L3Harris Technologies LHX is scheduled to announce its fourth-quarter results on Jan 29.
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