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Key Takeaways
- Boeing shares are back on the radar Monday after the company said a 737 MAX production glitch could delay some near-term deliveries.
- Boeing says the the production issue doesn’t pose a safety risk and that existing MAX planes could continue to fly.
- Boeing shares, which have recently seen increased trading volume, may find support from an uptrend line around $193 and resistance from the August swing high near $240.
The Boeing Company
Source: TradingView.com.
Boeing (BA) shares are once again on investors’ radar screens Monday after the Seattle-based airplane maker said a production glitch detected by a supplier on the fuselage of some of its undelivered 737 MAX aircraft could disrupt deliveries.
The aerospace giant confirmed that a spacing problem involving holes drilled on the window frame of around 50 jets had been identified by its 737 fuselage supplier Spirit AeroSystems (SPR) and could potentially delay some near-term deliveries. However, the company said the production glitch didn’t pose a safety risk and that existing 737 MAX planes could continue to fly. “While this potential condition is not an immediate flight safety issue and all 737s can continue operating safely, we currently believe we will have to perform rework on about 50 undelivered airplanes,” Boeing Commercial Airplanes CEO Stan Deal said in a letter to staff cited by Reuters. Deal said the airplane manufacturer plans to address the misaligned holes this week at its 737 Renton plant without pausing the entire production line.
Boeing’s latest mishap comes less than a month after the door plug of a 737 MAX 9 flown by Alaska Airlines (ALK) blew out mid-air, prompting aviation regulators to ground nearly 200 jets while investigators inspected similar door panels to those involved in the incident. Ultimately, the affected planes returned to service within several weeks; however, another MAX production problem reignites concerns over Boeing’s quality controls and what that might mean for company’s safety reputation and future aircraft deliveries. When reporting quarterly earnings last week, the company suspended its forward guidance for 2024 amid ongoing safety issues.
Since falling below the 200-day moving average in mid-January, the Boeing share price has consolidated within a tight range just under the closely-watched indicator. It’s also worth noting that volume has increased significantly in recent weeks, indicating institutional reallocations within the stock. On the downside, monitor a long-term uptrend line that stretches back to September 2022 as a possible area of support, currently around $193. If the price rallies above the 200-day moving average, keep an eye on the August swing high around $240 — a region on the chart that may provide overhead resistance.
Boeing shares were down 1.9% at $205.32 in pre-market trading Monday, about 40 minutes before the opening bell.
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