Boeing is further expanding its business in Asia. Hong Kong’s Cathay Pacific Airways Ltd. (DE:CTYA) is nearing a deal to order six of Boeing’s (NYSE:BA) 777-8F freighters for roughly $2 billion. Reuters reported that Cathay Pacific is looking to replenish its nearly 15-year-old freighters, which also belong to Boeing’s 747 cargo jets. Markedly, Cathay Pacific was contemplating between Boeing’s 777X family of freighters and rival Airbus’ (DE:AIR) soon-to-be-launched cargo version of the existing A350 model.
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The news follows recent reports of Boeing selling at least 150 737 Max jetliners to Riyadh Air. It is important to note that Boeing’s 777-8F freighter is a state-of-the-art model, with lower operational costs and a smaller noise profile, compared to the 747 carriers, making it an apt choice for Cathay Pacific.
Cathay Pacific is considered the world’s fifth-largest cargo carrier. Currently, Cathay Pacific’s cargo fleet includes six of Boeing’s 747-400F models and 14 of its 747-8F carriers.
A spokesperson for Cathay Pacific stated, “We continue to invest in and grow our fleet with the addition of new, state-of-the-art, and fuel-efficient aircraft,” without giving any names or specifics of the order.
Boeing’s 777X family has stalled production and is scheduled to resume sometime later this year. Meanwhile, the delivery of the 777X-9 model is slated for 2025, and that of the 777X-8F is set for 2027. The first-ever order for Boeing’s 777-8F model was given by Gulf carrier Qatar Airways in January last year.
Is BA Stock a Buy, Sell, or Hold?
On TipRanks, Boeing has a Moderate Buy consensus rating based on ten Buys and five Hold ratings. Also, the average Boeing price target of $238.40 implies 17.1% upside potential from current levels. Meanwhile, BA stock has gained 4.2% so far this year.
