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Though Boeing is showing signs of getting back on its feet, there are still a few more things to improve to guarantee a potential recovery run.
American multinational corporation that designs, manufactures, and sells airplanes Boeing Co (NYSE: BA) may be on its way to recovery after seeing profitability in February, the first in more than a year. As reported by the Motley Fool, the Seattle, Washington-based company saw an increase in the total number of aircraft deliveries in the past month, in comparison to the overall cancellations served in the same period.
Boeing sold 82 aircraft in the previous month, including a number of 737 MAX planes, compared to 51 cancellations. The record is a plus for the company after seeing its entire valuation drop by about $20 billion in 2020, as its deliveries were hampered year-round.
Beginning in 2019, Boeing has seen a crisis which stems from its aircraft crashes, a set of occurrences that spurred the grounding of its flagship 737 MAX jets. The unforeseen outbreak of the coronavirus pandemic also aggravated the company’s woes as airline industries suffered the most, as both local and international travels were halted with countries closing their borders in a bid to help stop the spread of the highly contagious virus.
Airline and travel services providers were thus in no position to buy or order new planes, significantly weighing down Boeing’s business. The recorded deliveries in February have however signaled to investors the firm is on its way toward recovery, a sentiment that was reflected in the shares performance of the company.
Boeing stock closed Wednesday with a bullish 6.39% growth to $245.34 each. The momentum picked a new pace in the pre-market as the shares surged by an additional 2.18%. The closing price on Wednesday fell short of the 52-week high by just a dollar.
Is Boeing Recovery Guaranteed Now?
Though Boeing is showing signs of getting back on its feet, there are still a few more things to perfect to guarantee a potential recovery run. Per the Motley Fool report, the bulk of the orders seen in February were from the military, notably 27 Air Force tankers. This shows that airlines are still not fully bolstering their order books, a pace which must be maintained to guarantee a run back to levels before the 2019 mishaps crept in.
Beating the competition with its archrival Airbus SE (EPA: AIR) is also important to regain the right share of the market. To do this, Boeing will hope the airlines favor its operational narrowbody jet fleet over the larger Airbus’ products.
The latest aircraft leasing deal between General Electric Company (NYSE: GE), and AerCap Holdings (NYSE: AER) worth $30 billion has been reported to be favorable to Boeing and Airbus, the two favored manufacturers primarily serving both companies.
The rapid roll-out of the COVID-19 vaccine renews the hope for air travel demands to spike in the next months, a situation that will favor all airlines, and aircraft manufacturers, Boeing inclusive.