Boeing Financial Analysis
The Boeing Company was formed in 1916 by William E. Boeing in Seattle, Washington. The following year they had a twenty eight person payroll which included pilots, carpenters, boat builders and seamstresses. The lowest wage was fourteen cents an hour, while the company's top pilots made two to three hundred dollars a month. When the company was short on money, William Boeing used his own financial resources to guarantee a loan to cover all wages, which was a total of about seven hundred a week. ("Boeing History," n.d) In 1997, they merged with McDonnell Douglas and are currently the world's largest aerospace company and leading manufacturer of commercial airliners and defense, space and security systems. With
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A few of their major competitors are: Lockheed Martin, Honeywell, General Dynamics, Raytheon, Embraer and Rockwell Collins. Following the merger with McDonnell Douglas, Lockheed Martin could not keep up in the commercial airlines industry and now only manufactures military aircraft. Lockheed is now their largest competitor for government contracts.
Boeing vs. Industry Leaders
Statistic Industry Leader Boeing Boeing Rank
Market Capitalization Boeing 55.97B 1 of 51
P/E Ratio CPI Aerostructures 56.79 14.9 21 of 51
PEG Ratio Alliant Techsystems Inc. 4.53 1.13 17 of 51
Revenue Growth Butler Natl. Corp 28.40% 4.5% 30 of 51
EPS Growth AeroVironment Inc. 2900% 30.80% 17 of 51
Long Term Growth Rate Embraer 45.76% 13.51% 21 of 51
Return on Equity Lockheed Martin 82.23% 71.42% 2 of 51
Dividend Yield Lockheed Martin 4.9% 2.3% 5 of 51
(Yahoo finance, 2012) By comparing the above companies, Boeing is a very strong and stable company. Large cap companies have market caps of $5 billion or more. This category includes the big blue chip companies that are household names to most investors. Although investors in stocks in any market capitalization category incur risk, surprises have traditionally been less likely among these blue chip companies (Ross, 2011). Their high return on equity measures how much the shareholders earned for their investment in the company.
With only a few large companies across the globe (Boeing, MD, and Airbus), the commercial aircraft industry essentially exhibits the qualities of an oligopolistic competition with intense rivalry. Here is an analysis of competition in the commercial aircraft business using Porter’s Five Forces.
As the two largest producers in the commercial aircraft industry, Boeing and Airbus have been in a long rivalry for over two decades. Because of its huge research and development cost and a volatile market demand situation, the large commercial aircraft industry has only a few viable producers that can successfully operate in this industry. At the end of 1996, there were three competitors in the industry – Airbus, Boeing, and McDonnell Douglas (MDC). When Boeing announced in December 1996 the merger between Boeing and McDonnell Douglas, the dispute has again started between Boeing and Airbus. The merger was expected to go under
The company was originally founded by William Boeing on July 15, 1916, as "The Pacific Aero Products Company". Two years later it was renamed into “The Boeing Company”, on May 9, 1917. Since that date the company grew and acquired a lot of its competitors, including the McDonnell Douglas in 1997.
As Russell Menere, I recommend the management of Boeing Australia Limited to follow the footsteps of Boeing Seattle to adopt and implement cost effective e-Procurement system, which can be interfaced with the legacy information system as we have IT infrastructure in place that is our core strength.
The world of finance in today’s market is one of numerous ups and downs. With the global economy in constant flux, it is more important than every for companies to examine their financial status and compare their position to that of the relative market as well as their fellow competitors. In order to better understand the ways in which today’s managers examine their position on the market and evaluate their current value as a company we will examine the financial data of Lockheed Martin Corporation and perform a detailed financial analysis on the company. In this
THE BOEING COMPANY: STRATEGIC AUDIT I. CURRENT SITUATION A. Current Performance Boeing performance has been outstanding for the past few years. Their Return on investment rose from three percent to 6 percent from 1998 to 1999, but it did drop to five percent in 2000. In 1996 Airbus claimed 42% of the market share, while Boeing had 64%. Boeing is looking at falling below the 50% mark. Boeing's profits have been doing quite well. They have risen drastically in the past few years, which can be seen in the profitability ratios. Boeing is doing fine when it comes to profitability, even though they have dropped slightly since 1999.
In 1997, Boeing lost $1.6 billion against their earnings due to problems with the supply of critical components. They had to halt the production of the 737 and the 747. In 2006, suppliers for Boeing’s 787 fell behind schedule which resulted in a delay of production.
Airbus is a consortium of European aircraft manufacturers formed in 1970; Boeing Company was founded in 1916 as the world's largest private commercial aircraft manufacturer in the USA; and finally McDonnell Douglas, considered the third major manufacturer, began operations since 1920 working essentially for the US government, manufacturing
As the new century unfolded, Delta Air Lines continued exponential growth becoming one of the largest airlines in the country. A merger with Western Airlines in 1987, the acquisition of Pan Am’s transatlantic routes in 1991, and a final merger with Northwest Airlines in 2008 meant Delta now had routes all over the world. Delta like many other airlines faced very difficult times post 9/11 and during the recession. The airline made significant cost improvements across its operation and the merger with Northwest Airlines ended up pushing the airline back into profitable business.
Boeing Company has been and is still at the forefront of the aviation industry. The late 1990s were a time of trial and transition where the company encountered and overcame a number of
The Boeing Corporation is one of the largest manufacturers in the world. Rivaled only by European giant Airbus in the aerospace industry, Boeing is a leader in research, design and manufacture of commercial jet airliners, for commercial, industrial and military customers. Despite enjoying immense success in its market and dominating an industry that solely recognizes engineering excellence, it is crucial for Boeing to ensure continued growth through consistent strategy formulation and execution to avoid falling behind in market share to close and coming rivals.
In January 2006, company-owned bottling operations were brought together to form the Bottling Investments operating group, now the second-largest bottling partner in the Coca-Cola system in terms of unit case volume.
Lockheed Martin is a major security and aerospace company headquartered in Bethesda, Maryland. Employing over 97,000 employees worldwide, Lockheed Martin is principally focused on research, design, development, manufacture, integration, and sustainment of advanced technology systems, products, and services (Lockheed Martin at a Glance, n.d.). Lockheed Martin is organized into broad business areas to include aeronautics ($17.8 billion in 2016 sales), missile and fire control (6.6 billion in 2016 sales), rotary and mission systems (13.5 billion in 2016 sales), and space systems (9.4 billion in 2016 sales) (Lockheed Martin at a Glance, n.d.). To better understand the global giant that is today’s Lockheed Martin, a historical look at the two companies that merged in 1995 and their respective accomplishments is essential.
Boeing is a world leader in the aerospace industry. At one point they were the highest seller’s commercial aviation with no competition in sight. That all changed, and soon Boeing had to change.
In 2010, Halliburton produced revenue of $17,973 billion and operating income of $3,009 billion, reflecting an operating margin of approximately 17%. Revenue increased by $3,298 billion, or 22% from 2009, while operating income increased $1,015 billion, or 51% from 2009. According to Halliburton’s 2010 Annual Report, “these increases were due to its customers’ higher capital spending throughout 2010, led by increased drilling activity and pricing improvements in North America” (Hal 2010 annual report). However, Halliburton remains cautious because of the shifts in oil and natural gas prices and supply/demand factors. These “shifts” are important for equipment and services providers in the oil and gas industry because it affects the