Boeing Stock Surges Following Major Emirates Order and Union Agreement

Boeing (NYSE: BA) shares experienced a significant uptick in premarket trading on Monday, October 21, 2024, driven by two key developments. The aerospace giant announced that Emirates SkyCargo has placed an order for five additional 777 Freighters, building on a previous order for the same number of aircraft. This latest order brings Emirates’ total requests for Boeing widebody aircraft to 249, including 14 of the 777 Freighters.

The 777 Freighter is highly regarded for its specifications, featuring a range of 9,000 kilometers and a maximum payload of 102 tonnes, making it the longest-range, highest-capacity twin-engine freighter available. This order is part of Emirates SkyCargo’s strategy to nearly double its fleet of 777 Freighters from 11 to 21 in the coming years, enhancing its capacity and operational efficiency.

In addition to the Emirates order, Boeing shares were also boosted by a tentative agreement between the company and its union workers. The proposed deal includes a 35% wage increase over four years, along with enhanced retirement benefits. If ratified, this agreement will replace an earlier contract from 2008 and is aimed at addressing Boeing’s ongoing financial challenges.

Despite recent financial strains, including a balance sheet that remains stretched and ongoing delays that have impacted the airline industry, Boeing’s stock price has seen a positive reaction to these developments. As of the latest update, BA shares were up 3.87% in premarket trading, trading at $161.00.

Analyst sentiments have been mixed, with some firms adjusting their price targets for Boeing. For instance, Morgan Stanley decreased their price objective on Boeing from $195.00 to $170.00, while Citigroup trimmed their target price from $224.00 to $209.00.