Bad news for anyone hoping that aerospace stock Boeing (BA) would bring more jobs to the Indian subcontinent emerged recently. The newest reports say that an assembly line in India is pretty much out of the picture without a substantial uptick in business. The news proved less than welcome to shareholders, who sent shares down fractionally in Monday afternoon’s trading.
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Boeing’s president for India and South Asia, Salil Gupte, noted that Boeing would need “…many more airplanes…” being purchased in the Indian market than are being purchased today to get an assembly line fired up therein. Gupte was not willing to shut down the idea altogether, though, noting that Boeing would have to see how the markets in and around India shaped up before making any final decisions.
For right now, though, the numbers just do not support the business case of setting up an assembly operation in the country. This actually runs contrary to earlier remarks from the prime minister, Narendra Modi, who noted that India will not have long to wait to see a Boeing plane designed and manufactured there. But with Gupte’s remarks, unless Modi can pull a load of orders out of his pocket, that promise looks like one that simply will not materialize.
Spirit Getting Dispirited
The news got worse for Boeing, however, as Spirit AeroSystems (SPR) is set to issue a “going concern” alert as Boeing looks to take it over. With Spirit set to file its 10-K report with the Securities and Exchange Commission (SEC), Spirit is also poised to add the declaration to the file.
A combination of low liquidity and uncertain cash flow is leaving Spirit on the back foot, reports noted, and the latest numbers will prove little help. Spirit projected a loss of $413 million for its latest quarter, and revenue is set to slip to $1.66 billion, down 8.3% against this time last year. This will be mixed against analyst estimates, which looked for a loss of just $168.4 million and revenue of $1.52 billion.
Is Boeing a Good Stock to Buy Right Now?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on BA stock based on 13 Buys, five Holds and one Sell assigned in the past three months, as indicated by the graphic below. After a 13.8% loss in its share price over the past year, the average BA price target of $196.12 per share implies 8.69% upside potential.
