Boeing 787 deliveries could mean a $17 billion windfall: Morgan Stanley

Boeing could be poised to see a big financial boost as it regains the authority to deliver 787 jets.

Morgan Stanley Analyst Kristine Liwag estimated that Boeing may realize $17 billion in sales from the 120 787 airplanes it currently has in inventory waiting for delivery.

“This is a major milestone for the business and unlocks another lever of free cash flow generation,” Liwag wrote in a new note to clients, describing the development as a “positive catalyst” for the stock.

Liwag predicted that Boeing will deliver 20 787 aircraft in 2022, stepping up to 66 in 2023, and then 110 in 2024.

ANA All Nippon Airways Boeing 787 Dreamliner aircraft in Brussels, Belgium on January 30, 2022 (Photo by Nicolas Economou/NurPhoto via Getty Images)

The FAA has reportedly signed off on Boeing’s plan to correct 787 production issues and restart deliveries. Boeing has not delivered any 787 airliners since May 2021 while authorities reviewed production flaws.

The company delivered 48 787 aircraft in the second quarter of 2019, before the production issues came to light.

Shares of the aerospace giant rose more than 7% as of 12:40 pm ET during Monday’s trading session.

The company also had the most visited ticker page on the Yahoo Finance platform as of midday Monday, underscoring investor enthusiasm for an improved Boeing investment thesis.

Although, the lack of 787 deliveries has continued to hamper Boeing’s finances.

Boeing’s second-quarter sales and non-GAAP operating profits fell 2% and 35%, respectively.

“We expect Boeing to emerge from the 737 MAX crisis and begin generating cash in 2022, with the stock being driven by multiple catalysts including the return of the 787, 737 MAX re-certification in China, and increased deliveries,” JP Morgan analyst Seth Seifman said in a post-earnings note.

The analyst reiterated an overweight rating on Boeing stock with a $200 price target.

Brian Sozzi is an editor-at-large and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.

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