Boeing (BA) filed to raise up to $25 billion through a combination of stock and debt offerings and entered into a $10 billion supplemental credit agreement with lenders. The move comes as the company attempts to shore up its balance sheet amidst ongoing strikes at its West Coast factories.
While Boeing filed to raise up to $25 billion, analysts estimate that it needs to bring in at least $10 billion and $15 billion, according to Reuters. This would allow the company to maintain its credit ratings, which are just one notch above junk, it added.
"These are two prudent steps to support the company's access to liquidity," Boeing said in a statement to Reuters. "This universal shelf registration provides flexibility for the company to seek a variety of capital options as needed to support the company's balance sheet over a three-year period."
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Previously, Boeing was reportedly working with its advisers to raise at least $10 billion.
Boeing reports preliminary results and layoffs
On Friday, Boeing released its preliminary third-quarter results, which included a net loss of $9.97 per share, a cash burn of $1.3 billion and an ending balance of cash and marketable securities of $10.5 billion.
In a separate release, Boeing announced that it would reduce the size of its total workforce by roughly 10%, or about 17,000 people.
"Our business is in a difficult position, and it is hard to overstate the challenges we face together," said new Boeing CEO Kelly Ortberg in a statement. "Beyond navigating our current environment, restoring our company requires tough decisions and we will have to make structural changes to ensure we can stay competitive and deliver for our customers over the long term."
Is BA stock a buy, sell or hold?
Boeing has been one of the worst Dow Jones stocks in 2024, down nearly 42% for the year to date. Yet, Wall Street remains bullish on the the large-cap stock.
According to S&P Global Market Intelligence, the average analyst target price for BA stock is $199.88, representing implied upside of nearly 32% to current levels. Additionally, the consensus recommendation is Buy.
Financial services firm UBS Global Research lowered its price target on BA stock to $215 from $220 but maintained its Buy rating after the preliminary results were released.
"Boeing announced preliminary Q3 results and a number of business and operational updates," wrote UBS analyst Gavin Parsons on October 14. "In short: we believe cost rightsizing and a narrower focus are necessary steps, but highlight the long road to recovery. Less cash burn in Q3 gives Boeing slightly more flexibility on liquidity than expected, but cost-out steps also suggest labor contract negotiations could extend."
Related content
-
Nasdaq Rises 2.7% as Musk Tweets TSLA Higher: Stock Market TodayMarkets follow through on Friday's reversal rally with even bigger moves on Monday.
-
4 Black Friday Scams to Watch Out forThe deals are heating up, but so are the scams. Here's how to spot some of the most common Black Friday scams this holiday season.
-
Nasdaq Rises 2.7% as Musk Tweets TSLA Higher: Stock Market Today
Markets follow through on Friday's reversal rally with even bigger moves on Monday.
-
Holidays Are a Rich Time to Talk Money With Young Adults: A Financial Adviser's Guide for ParentsThe most productive family financial conversations start with open-ended questions and a lot of listening. Don't let this opportunity pass you by.
-
How Women of Wealth Are Creating a New Model of Giving Through Family OfficesWomen who are inheriting wealth today are shifting from traditional philanthropy to creating sustainable systems to fund philanthropic gifts into perpetuity.
-
I'm a Financial Planner: This Retirement GPS Helps With Navigating Your Drawdown PhaseReady to retire? Here's how to swap your 'peak earnings' mindset for a 'preserve-plus-grow' approach instead of relying on the old, risky 4% rule.
-
Donating Stock Instead of Cash Is the 2-for-1 Deal You'll Love at Tax TimeGiving appreciated stock or using a donor-advised fund (DAF) this year would be smarter than writing a check to support your favorite causes. Here's why.
-
Traveling With Purpose: What Zambia and Zimbabwe Taught Us About Slowing DownDon't treat retirement trips like they're an exercise in ticking off boxes. Slowing down and letting adventure unfold can create more meaningful memories.
-
Investment Expert: Is Your Retirement Portfolio Too Late to the Profit Party?If you're following the usual retirement investment model, you could be missing out on a potential profit period that companies see in the run-up to their IPOs.
-
Losing Your Job? A Financial Planner's 6 Steps to Survive and ThriveWhether pink slips are just rumors at your company or layoffs have already landed, there are things you can do today to make the best of a tough situation.
