Boeing (NYSE:BA) is gearing up to resume the delivery of its 737 Max aircraft to China, marking a significant milestone for the aerospace giant's recovery from a major crisis. The expected continuation of deliveries would be the first in four years and is seen as a significant step forward for Boeing.
Bloomberg News reported that the first deliveries are expected in the next few weeks. Accordingly, Boeing recently moved two 737 Max jets – originally produced for Chinese airlines – out of storage.
China Southern Airlines Co. (SS:600029), the largest carrier in China, is reportedly positioned to be the first to receive the newly delivered 737 Max from Boeing.
“We continue to support our customers in China, with more than 95% of their current 737 MAX fleet in service,” Boeing said in a statement, according to Bloomberg.
“For deliveries, we will be ready to deliver for our customers when that time comes.”
TD Cowen analysts said BA stock is “poised for a rebound.” As a result, they lifted the price target by $5 to $260 per share.
“Likely China delivery restart & upcoming expected favorable update on the 737 bulkhead issue offer upside given the stock's 7% dip from its recent peak. We still see an extended upcycle,” the analysts added.
Citi analysts believe that new orders, should they occur, “would likely put upward bias on production rates and Boeing’s medium-term cash flow targets.”