Aerospace stock Boeing (BA) managed to pull out a significant win at the Dubai Airshow today, and from a source that was previously considered a significant loss: flydubai. Where recently, it lost orders to rival Airbus’ (EADSY), it actually won a major new order. But this was somehow not enough for investors, who sent shares into a tailspin, down nearly 3% in Wednesday afternoon’s trading.
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The latest word noted that flydubai put in a memorandum of understanding (MoU) for another 75 Boeing 737 MAX airplanes. Further, it includes the option for another 75 on top of that, bringing the total of this particular order to 150, potentially. In no uncertain terms, flydubai noted that the “…fuel efficiency, range and reliability…” of the 737 MAX has had a major hand in fueling flydubai’s overall network expansion.
The chairman of flydubai, Sheikh Ahmed bin Saeed al-Maktoum, noted “We are proud to place another 737 MAX order with Boeing, a trusted partner that has played a key role in growing our network to its current scale. Reliable aircraft availability and timely deliveries are vital to the ongoing growth of our industry, and this agreement ensures we remain well-positioned for future growth, adding to the fleet as well as replacing current aircraft.”
Breaking the Ice
Though this point will likely mean little in Dubai, for those who fly in freezing temperatures, news of Boeing’s new engine anti-ice system will likely be much more welcome. Boeing recently completed both design and engineering tasks for the system, and is currently working with the Federal Aviation Administration (FAA) to certify the system.
Once completed, new deliveries should have the system included, and current aircraft would get a retrofitted model that could be added later on. The new system was years in the making, reports noted, and thousands of man-hours as well. But if certification goes through, Boeing will likely be able to make its planes even more attractive to cold-facing operations.
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 13 Buys, two Holds and one Sell assigned in the past three months, as indicated by the graphic below. After a 29.81% rally in its share price over the past year, the average BA price target of $250.50 per share implies 36.2% upside potential.
