How reliable are BA's earnings forecasts?

The reliability of Boeing's (BA) earnings forecasts is a subject of mixed perspectives, reflecting both the company's challenges and potential for recovery.

1. **Recent Analyst Adjustments**: William Blair analysts have recently raised their Q4 2025 earnings per share (EPS) estimates for Boeing from $0.52 to $0.65, indicating a more optimistic outlook. This adjustment reflects a belief in improved profitability for the period.
2. **Consensus Estimates**: The consensus estimate for BA's current full-year earnings is a loss of $2.58 per share. This suggests that while there is a range of expectations, the majority of analysts do not expect profitability this year.
3. **Historical Performance**: Boeing's earnings have been volatile, with a significant decline in Q4 2024, reporting earnings of -$5.90 per share, missing the consensus by -$4.30. This recent miss highlights the company's ongoing challenges.
4. **Contract Wins and Market Confidence**: Despite the earnings challenges, recent contract wins, such as the $240 million Chinook helicopter contract and the landmark order from Korean Air for up to 50 wide-body aircraft, indicate strong demand and market confidence in Boeing's product line.
5. **Legal and Fraudulent Activities**: Boeing is also facing a criminal fraud trial related to the 737 MAX crashes, which could impact future earnings. This adds an element of uncertainty that may affect the reliability of earnings forecasts.
6. **Revenue Estimates**: The estimated revenue for Q1 2025 is $18.77 billion, which, if met, would represent a significant revenue stream. However, revenue forecasts are also subject to the same uncertainties as earnings forecasts, including market conditions and operational performance.

In conclusion, while there are positive signs of recovery and new contract wins that could improve BA's financial performance, the overall earnings forecast remains negative for the current year. The reliability of these forecasts is thus dependent on various factors, including operational performance, market conditions, and unforeseen events such as legal challenges. Investors should monitor these factors closely when assessing the reliability of BA's earnings forecasts.