Boeing July deliveries hold decent pace, Chinese resumption expected soon: BofA

Investing.com -- Boeing (NYSE:BA) is on track for a solid July in terms of 737 deliveries, as per a note from BofA Securities, citing data from Aero Analysis Partners/AIR (AAP/AIR). While the pace is expected to slow from the June peak, it aligns with historical seasonal trends. The company is also ramping up production, with July output projected to reach around 27 aircraft.

A key highlight of the note is the increasing activity surrounding 737 deliveries to China. With multiple aircraft undergoing pre-delivery flights and a surge in customer acceptance flights, analysts anticipate a swift resumption of deliveries to the Chinese market. This could boost Boeing's delivery numbers in the coming weeks.

While the 737 program takes center stage, analysts also flag  a pickup in 787 deliveries for July, compared to the previous month. However, production for this wide-body aircraft remains at rate-3, with an expected return to rate-5 by year-end.

BofA maintains a Neutral rating on Boeing, with a price objective of $200. The firm's valuation is based on normalized free cash flow and relative value to the S&P 500. 

While flagging upside risks from factors such as increased cash margins and strong demand for commercial jets, BofA also mentions potential downside risks, including competition for talent, execution risks on new programs, and geopolitical uncertainties.