Jefferies Offers Production Rate Estimates on Boeing's (BA) New B787, Sees Substantial FCF

Jefferies is reaffirming its Buy rating and $90 price target on shares of Boeing (NYSE: BA) with the delivery of the first B787.

The company should be able to produce roughly 5 plans per month by the end of 2012 and will double its production rate to 10 plans per month by the end of 2013. The firm believes this offers substantial cash flow growth "as its major development programs begin to transition to a measured rate of production."

Boeing has plans to deliver an addition 12 new jetliners to ANA by the end of March 2012 and another 8 in its next fiscal year.

An analyst at the firm comments, "We expect the next production rate increase to take place in the fourth quarter of 2011, and a step-up of one plane per month to 3.5 to occur in the first half of 2012. The acceleration in rate can not fully come about until the final engineering changes related to certification of the plane are incorporated into the supply chain."

For 2011-2013, Jefferies is forecasting EPS of $4.45, $5.00, and $6.00. Revenue for fiscal 2011-2013 is estimated to be $69.65 billion, $79.43 billion, and $86.3 billion.

For more ratings news on Boeing click here and for the rating history of Boeing click here.

Shares of Boeing closed at $59.51 yesterday.

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