“Flight delayed” might be one of the worst things you can hear in an airport. It turns out that the same thing also goes for aircraft manufacturers like aerospace stock Boeing (BA), which announced that all flights on the 777X jet have been delayed to 2027. Investors were less than pleased, and shares slipped fractionally in Friday afternoon’s trading.
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Originally, the 777X was supposed to start appearing in deliveries in 2026. But new reports out of Boeing say that the jet will be delayed another year instead. Reasons, meanwhile, are thin on the ground, with Boeing refusing to comment. Originally, reports suggest, the plane was set to go live in 2020, based on reports from 2013, and the subsequent delays pushed the plane back another six years on top of that. But Boeing has had trouble certifying the plane, and when a series of mechanical issues emerged on its other planes, that just pushed the whole process back.
The fallout was swift. Early purchasers, like Deutsche Lufthansa (DLAKY), have already responded by keeping the 777X out of fleet calculations until 2027. A charge related to the delay is set to appear in third-quarter earnings reports when those emerge later this month, in the amount of between $1 billion and $4 billion.
Scabs Forever
Boeing is stepping up its hiring of replacement workers to take over for the striking workers in St. Louis, reports note, as Boeing looks to “…boost recruitment efforts” as the strike carries on. Dan Gillian, the leading executive in St. Louis for Boeing, noted that the strike could go on for weeks, even months, longer thanks to “…the union leadership’s actions over the past few weeks.”
Early job fairs have proven to be a “success,” reports note, and the new hires are set to start training later today. The union, meanwhile, responded accordingly, saying, “Dan Gillian just sent an email about how hard he’s trying to get scab labor to build the world’s most advanced military systems. There are 3,200 highly skilled workers ready to get back on the job. The union continues to be ready to negotiate a fair deal.”
Is Boeing a Good Stock to Buy Right Now?
Turning to Wall Street, analysts have a Strong Buy consensus rating on BA stock based on 16 Buys and two Holds assigned in the past three months, as indicated by the graphic below. After a 40.28% rally in its share price over the past year, the average BA price target of $257 per share implies 19.04% upside potential.
