BA Stock In Buy Range; Boeing Set For Historic Jet Orders

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The Street expects Boeing (BA) will announce a major order for 787 Dreamliner widebody jets from United Airlines (UAL) Tuesday. BA stock rose in buy range Monday amid reports of another, separate, possible huge jet order in coming days.

A leaked invitation showed the Dow Jones aviation giant and United plan a joint “historic announcement.” They will make the announcement Tuesday at Boeing’s South Carolina facility. That venue is where Boeing makes all 787 variants, leading to media speculation that the order will involve that jet, also known as the Dreamliner.

The Wall Street Journal previously reported that United is looking to order around 100 planes. It wants to replace its fleet of aging and struggling widebody jets, including Boeing 767s.

Plane makers and their airline customers are seeing commercial aircraft demand recover after a yearslong hit, due to Covid-19 travel restrictions. Meanwhile, Boeing is restructuring after a series of industrywide and company-specific challenges.

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BA Stock

Shares of Boeing popped 3.7% to 186.18 on the stock market today. The move put BA stock beyond the 5% chase zone from a 173.95 buy point for a cup base.

BA stock is still in buy range above an alternate entry near 180, from its recent mini-consolidation.

The Dow Jones stock made choppy progress from its Nov. 10 breakout past the cup-shape entry. The relative strength line for Boeing stock is at its best levels since February, a sign of outperformance vs. the S&P 500 index.

UAL stock rose 2.8% Monday.

Boeing Eyes Air India Deal

Meanwhile, on Sunday sources told Reuters that Air India is close to ordering 500 jetliners worth tens of billions of dollars from both Boeing and Airbus (EADSY).

The order would rank “among the biggest by a single airline in volume terms,” the news report said. It would even overshadow “a combined order for 460 Airbus and Boeing jets from American Airlines over a decade ago.”

Air India is undergoing a financial restructuring after diversified, privately held Indian heavyweight Tata Group regained control of the airline in January. Tata Group is also the parent Tata Motors (TTM).

The timeline for an official announcement of the order is unclear. But Reuters said sources sought anonymity because “finishing touches are (expected to be) placed on the mammoth deal in coming days.”

EADSY shares climbed 1.9%. TTM shares edged up 0.1%, below the 50-day moving average, on Monday.

India is the world’s fastest-growing air travel market, according to Reuters.

At an investor day on Nov. 9, Boeing gave a free cash outlook well above Wall Street’s estimates on expectations for rising jet deliveries. That lifted BA stock more than 5% the next day.

During the pandemic, Boeing suffered from the collapse in commercial and business air travel, which pounded BA stock. That compounded the grounding of the global 737 MAX fleet following two fatal crashes in 2018 and 2019. The company also faced setbacks to key defense programs.

Additionally, recession fears and supply disruptions are now rippling through industrial manufacturing chains, including airlines.

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