Coinspeaker
Boeing (BA) Stock Rises 8% Now amid Fears of New Coronavirus Wave

Despite the fact that there were no major announcements made by Boeing Company (NYSE: BA), its stock surged 10% after the market opened on Friday, having closed yesterday at $170. At the time of writing the shares were trading around $183.95 (+8.21%), which is a drop from this week’s ATH slightly above $230.

The company has been adversely affected by the coronavirus lockdown that has made it ground its fleet. As the possibility of a new coronavirus wave lingers around, the company’s future remains fragile, whereby the shares might drop further more than they did in March.

According to data from MarketWatch, Boeing (BA) stock has dropped 48.53% in the past twelve months, dropped 45.14% YTD, added 7.69% in the past three months, added 52% in the last one month, and dropped 10.77% in the past 5 days.

In a bid to sustain its cash flow, the company asked its fuselage suppliers to pause the production of the 737 Max. During the ongoing coronavirus pandemic, the company has implemented several measures meant to sustain its businesses through the crisis. Besides the government handout, the company reduced some of its employees.

According to Miller Value Partners, they saw some gains after investing in the company during the pandemic. “Boeing’s CEO, David Calhoun, stated that Boeing will not accept government aid if it requires an equity stake noting that they have plenty of other options. The company has stated that they have -$15 billion in liquidity and believes they will be able to meet its obligation through the summer (-8 months). The company suspended their regular divided indefinitely while also pausing any share buybacks,” Miller Value Partner said in a statement.

The air travel industry might see several airlines close businesses post-COVID-19, and the lucky few thrive as the market will spring out gradually. Most investors remain wary of putting their capital in the air travel industry as the level of uncertainty increases.

Most airlines including American Airlines Group Inc (NASDAQ: AAL) are working on reducing their cash burn to see them through the pandemic. In an announcement made by the company, it said that it is ahead of schedule on reducing its cash burn that reduced from $100 million a day in April to $40 million a day by May.

If the second coronavirus wave prevails in the United States before a vaccine is approved, the airline industry will continue bleeding out. The long-lasting relief will come when the lockdowns are all lifted and a cure or vaccine is ready for the public.

Boeing (BA) Stock Rises 8% Now amid Fears of New Coronavirus Wave

467 +