The aerospace industry continues to bleed money. Boeing (NYSE:BA), in its latest report announced that it has had a very disappointing performance in Q4 2013. The revenues for the company although increased by approximately 7%. The core operating earnings for that matter were flat in comparison to the previous quarter. This was because of a 50 basis-point nosedive in the industry’s core operating margin.
What’s weird with Boeing is that the company keeps facing share-price pressure every time the market starts restructuring. The recent instance being the collapse of the Argentine peso and South African rand which has jeopardized the company’s performance in the respective countries due to unexpected rate hikes. China on the other hand with its own set list of setbacks hasn’t proved to be a decent market either. The recent slowdown in manufacturing, banking concerns and an unstable real estate market has made things worse for the business there.
- Warning! GuruFocus has detected 9 Warning Signs with BA. Click here to check it out.
- BA 15-Year Financial Data
- The intrinsic value of BA
- Peter Lynch Chart of BA
The company’s predicted core earnings for 2014 is expected to be around $7.00-$7.20 on an average revenue figure of $87.5-$90.5 billion.
The analysts have predicted that there might be impressive increase in commercial orders for the company in 2014. The total backlog that the company has is a shocking $441 billion. This, the experts feel, will be somewhat taken care of reduced to a huge extent by the year end. However the operating cash flow, the analysts say, won’t be as resilient as last year.
The current downturn that the aerospace industry faces is not going to linger on for a very long time. Things are supposed to be back to normal in some time. Boeing will definitely come out as a winner once this ends. However, for the time being investment in the stocks might not be a wise decision. The company ended the year with $15.3 billion in cash and investments and $9.6 billion in debt.