Research Update: Boeing Co. Ratings Affirmed On Greater-Than-Expected Equity Issuance; Remains On CreditWatch

Boeing Co. issued $24.3 billion of equity and equity-linked securities, which exceeded our expectations and mitigates the financial impact of cash flow deficits now expected through 2025. However, the company remains exposed to financial risks associated with the ongoing strike by its machinist union, and potential delay in the recovery of its aircraft production. In our view, Boeing has limited flexibility to absorb further pressure on its cash flow generation that would delay improvement in its credit measures. As a result, our ratings remain on CreditWatch with negative implications. We affirmed our issuer and issue-level credit ratings on the company at 'BBB-'. The CreditWatch status reflects the elevated potential for a downgrade within the next few months in the event

...- Boeing Co. issued $24.3 billion of equity and equity-linked securities, which exceeded our expectations and mitigates the financial impact of cash flow deficits now expected through 2025. - However, the company remains exposed to financial risks associated with the ongoing strike by its machinist union, and potential delay in the recovery of its aircraft production. - In our view, Boeing has limited flexibility to absorb further pressure on its cash flow generation that would delay improvement in its credit measures. - As a result, our ratings remain on CreditWatch with negative implications. We affirmed our issuer and issue-level credit ratings on the company at '###-'. - The CreditWatch status reflects the elevated potential for a downgrade within the next few months in the event Boeing faces additional delays in the recovery of its cash flow and credit measures relative to our estimates, which would most likely follow slower-than-expected aircraft deliveries....

Research Update