Alaska Air Warns Boeing Fleet Grounding Incident To Hit 2024 Earnings By $150M
Portfolio Pulse from Vandana Singh
Alaska Air Group Inc (ALK) reported Q4 operating revenue of $2.55 billion, a 3% Y/Y increase, and adjusted EPS of $0.30, beating estimates. The company is inspecting its Boeing 737 MAX 9 fleet and expects a $150 million earnings hit in 2024 due to the grounding incident. Alaska Air's 2024 earnings guidance of $3-$5 per share is below the consensus of $4.85, factoring in the impact of the Boeing fleet grounding. ALK shares rose 3.21% to $36.97.
January 25, 2024 | 3:38 pm
News sentiment analysis
Sort by:
Ascending
NEGATIVE IMPACT
Boeing's 737 MAX 9 fleet grounding has led to a thorough review by Alaska Air and a $150 million impact on Alaska's 2024 earnings, potentially affecting Boeing's reputation and future delivery schedules.
Boeing is indirectly affected by the grounding of its 737 MAX 9 fleet, as it may lead to increased regulatory scrutiny and concerns over production quality, which could negatively impact investor confidence and future sales.
CONFIDENCE 85
IMPORTANCE 70
RELEVANCE 80
NEUTRAL IMPACT
Alaska Air reported solid Q4 earnings but expects a $150 million negative impact on 2024 earnings due to the Boeing 737 MAX 9 fleet grounding. Shares are currently up.
While ALK's Q4 earnings were positive, the projected $150 million impact from the Boeing fleet grounding could dampen investor sentiment. However, the current share price increase indicates a short-term positive reaction, likely due to the earnings beat.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100