Boeing: Jefferies maintains 'buy' after 737 MAX crash
(CercleFinance.com) - Jefferies maintains its "buy" rating on the Boeing share, with a target price of 448 dollars, following the crash of the Ethiopian Airlines 737 MAX.
After this second deadly accident in six months for such a plane, the broker examines the current 737 MAX fleet, and its contribution to the US planemaker's results.
In a note to clients, Jefferies points out that the program continues to be Boeing's biggest seller, amassing more than 5,000 orders, representing about 29% of the company's revenue.
"The accidents could lead to near-term uncertainty with regards to utilization and deliveries", the broker writes in the report.
"In our view, a bear case scenario could be a software issue that requires a grounding of the fleet and temporary halt to deliveries," it says.
Assuming a two-month pause, the impact in terms of revenue would reach 5.1 billion dollars, or 5% of 2019 revenue, Jefferies said.
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The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.
After this second deadly accident in six months for such a plane, the broker examines the current 737 MAX fleet, and its contribution to the US planemaker's results.
In a note to clients, Jefferies points out that the program continues to be Boeing's biggest seller, amassing more than 5,000 orders, representing about 29% of the company's revenue.
"The accidents could lead to near-term uncertainty with regards to utilization and deliveries", the broker writes in the report.
"In our view, a bear case scenario could be a software issue that requires a grounding of the fleet and temporary halt to deliveries," it says.
Assuming a two-month pause, the impact in terms of revenue would reach 5.1 billion dollars, or 5% of 2019 revenue, Jefferies said.
Copyright (c) 2019 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.