The Boeing Company (BA) was awarded a $34.7 million cost-plus-fixed-fee contract for the design, development and test of the Harpoon and SLAM-ER Weapons Systems Joint Common Test Station. This contract combines purchases for the Government of Saudi Arabia and the Government of Australia under the Foreign Military Sales Program.
Work will be performed in St. Louis, Missouri, and is expected to be completed in March 2016. The Naval Air Systems Command, Patuxent River, Maryland, is the contracting activity.
Boeing enjoys a unique position as the largest aircraft manufacturer in the world in terms of revenues, orders and deliveries, and is also one of the largest aerospace and defense contractors. Besides, its revenues are spread across more than 90 countries around the globe.
Boeing taking into account its performance in the first nine months of 2012, raised its full year 2012 earnings per share guidance to a range of $4.80–$4.95 from its earlier guidance range of $4.40–$4.60. The company also raised its revenue guidance for 2012 to the range of $80.5 billion to $82 billion versus the earlier range of $79.5 billion to $81.5 billion.
The company expects its Commercial Airplanes' 2012 deliveries to come between 585 and 600 airplanes, which are already sold out. This includes an expected 70 to 85 787 and 747-8 deliveries. Commercial Airplanes' 2012 revenue is expected to be between $47.5 billion and $49.5 billion with operating margin around 9.0%.
In the defense space, the company expects defense revenue for 2012 to be between $32.5 billion and $33.0 billion versus its earlier range of $31.5 billion and $32.0 billion with operating margin greater than 9%. Boeing Capital Corporation expects that its aircraft finance portfolio will continue to decline in 2012.
Boeing currently retains a Zacks #3 Rank, which translates into a short-term Hold rating. Considering the fundamentals, we are maintaining our Neutral recommendation on the stock. This is in sync with other aerospace and defense behemoths, General Dynamics Corporation (GD) and Lockheed Martin Corporation (LMT).
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