Aerospace manufacturer Boeing Co. (NYSE: BA) has just confirmed its first 737 Max order in three quarters. The company said in a statement this week that Poland’s Enter Air had ordered two of the Max jets, which carry a list price of $99.7 million each in standard configuration.
The deal also includes an option for two additional jets to be purchased at a later date.
Boeing has faced major challenges in recent quarters, starting with the grounding of the 737 in March 2019 for safety issues, and followed by the Coronavirus Pandemic which has brought global air travel to a standstill.
Boeing hasn’t confirmed an order for the 737 Max since November last year.
A Small Order That Sends a Significant Message
This new order won’t be enough to put Boeing on a rebound, but it does indicate that better times are approaching for the company. Analysts believe that regulators are close to approving the 737 Max for flight again. The company has carried out a massive program to recertify and improve the safety features of its most popular modern jet, specifically in its software-based flight control systems.
Enter Air recognizes these advances, with Boeing saying in a statement that the purchase reinforces “confidence in the airplane and the men and women of Boeing.”
The Polish charter airline said in its own statement that it is “convinced” that the 737 Max will be “the best aircraft in the world for many years to come.” The company pointed to the “rigorous” safety checks and recertification process as factoring into its decision.
Boeing has so far received 4559 confirmed orders for the 737 Max and has delivered 387 completed aircraft. Because payment programs are finalized on delivery, the huge backlog leaves Boeing with a significant revenue pipeline to rely on in the coming years.
Is This a Good Sign for Investors?
A new order is clearly a positive, even if it’s a small order from a low-profile charter airline. Investors might not immediately see it as significant, but there are still reasons to consider Boeing stock today.
The share price is down -52.15% in the year to date, and some investors could consider today’s price to be an absolute bargain. A recovery is all but inevitable for the company. The organization has incredible strength and potential. From the orders on the books to new technologies in development, it remains one of just two global companies that can produce passenger and cargo aircraft on a large scale.
Boeing might be down today, but its future potential makes the stock worth considering as we approach the final quarter of 2020.
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