Boeing overcomes Dreamliner setbacks

Article Excerpt

THE BOEING CO. $76 (New York symbol BA; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 738.3 million; Market cap: $56.1 billion; Price-to-sales ratio: 0.9; Dividend yield: 2.2%; TSINetwork Rating: Above Average; www.boeing.com) has struggled in the past few years, mostly due to production problems with its new 787 Dreamliner passenger jet. The plane is now three years behind schedule. Even so, few airlines have cancelled their orders. That’s because the 787 uses 20% less fuel than comparable models. Boeing still has orders for 835 planes, worth a total of roughly $160 billion. Military sales offset cyclical risk Boeing gets about half of its revenue from its military and space divisions. This cuts its exposure to the highly cyclical airline industry. Moreover, strong sales of military aircraft have helped offset additional costs related to the delay of the Dreamliner. For example, Boeing recently received a $35-billion order from the U.S. Air Force for 179 new tanker aircraft. The company will begin delivering these…