Monday, April 11, 2011

Boeing (BA) (GE) (UTX) and Middle East Unrest

A report from Bloomberg earlier in the day that 40 percent of estimated orders from Airbus could be wiped out from unrest in the Middle East, misses another big part of the picture, and that is the negative effect it would also have on Boeing (NYSE:BA), and by extension, Boeing suppliers like General Electric (NYSE:GE) and United Technologies (NYSE:UTX).

While it's likely changes in government in Egypt and Tunisia, and possibly in Yemen, Syria, Bahrain, and Libya, could hurt Airbus's short-term performance. Boeing (NYSE:BA) investors specifically (and those in related plays on Boeing suppliers such as General Electric and United Technologies, should also keep in mind that bad news for Airbus isn't necessarily great news for Boeing, since the U.S. aerospace giant is looking for big orders in Arabia as well.

The bottom line is the unrest isn't good news for aircraft producers and their suppliers, although some, like Airbus, could be impacted in the short term more than others.

Boeing was trading at $73.80, gaining $0.33, or 0.45 percent, as of 1:41 PM EDT.

1 comment:

Anonymous said...

Looking at the referenced article, I'm left wondering what your point was?! Bloomberg was reporting what EADS/Airbus was saying about their Mideast prospects; it was an article reporting Airbus commentary. Boeing didn't come up because Airbus didn't mention Boeing.