Boeing (BA) Loses $8 Billion in Market Cap as Guidance Sends Shockwaves
Boeing (NYSE: BA) is under extreme pressure Wednesday following fourth quarter results but more importantly lower-than-expected 2016 guidance. Shares last traded down over 9%, losing near $8 billion in market cap.
The world's largest jetliner maker reported Q4 EPS of $1.60, $0.34 better than the analyst estimate of $1.26. Revenue for the quarter came in at $23.6 billion versus the consensus estimate of $23.55 billion.
Boeing sees FY2016 EPS of $8.15-$8.35, well below the consensus of $9.43. Boeing sees FY2016 revenue of $93-95 billion, below the consensus of $97.17 billion.
The company expects to deliver 740 to 745 planes in 2016, down from 762 in 2015. Last week, Boeing said it would cut 747-8 output to six planes per year from 12.
A number of Boeing suppliers are lower on the news: Rockwell Collins (NYSE: COL) -3.3%, General Dynamics (NYSE: GD) -3.3%, B/E Aerospace (NASDAQ: BEAV) -2.6%, Honeywell (NYSE: HON) -1.6%.
RBC Capital analyst, Robert Stallard, said the lower guidance could create doubt as to the sustainability of the company's existing plans to return cash to shareholders, although they don't expect the plans to be impacted at this time.