The Boeing Company Analysis
ADVANCED FINANCE
CORPORATE ANALYSIS
The Aerospace & Defense Industry
The Boeing Company
Table of Contents
EXECUTIVE SUMMARY 4
1. PRESENTATION OF THE BOEING COMPANY 5
1.1 Industry Analysis 6
1.2 Business of The Boeing Company 7
1.3 Origin and History’s Timelines of The Boeing Company 8
1.4 Management and Organizational Structure of The Boeing Company 11
1.5 The Corporate Strategy of The Boeing Company 14
2. THE SWOT ANALYSIS OF THE BOEING COMPANY 17
2.1. Strengths 17
2.2. Weaknesses 17
2.3. Opportunities 18
2.4 Threats 19
3. THE MARKET POSITION OF THE BOEING COMPANY 21
3.1 The potential threat of new sellers entering the market 21
3.2 The threat of substitute products becoming available in the market 21
3.3 The impact of the suppliers on the sellers 22
3.4 The power exerted by the customers in the market 22
3.5 The competitive intensity: the rivalry between existing sellers in the market 22
4. THE CAPITAL STRUCTURE OF THE BOEING COMPANY 25
5. THE FINANCIAL PERFORMANCE OF THE BOEING COMPANY 28
5.1 Liquidity Ratios 28
5.2 Profitability Ratios 30
5.3 Asset Turnover Ratios 33
6. STOCK PRICE PERFORMANCE ANALYSIS 37
6.1 Linear Regression Analysis and Calculation of Beta 37
6.2 The Boeing Company’s Stock Price Performance 38
6.3 EADS Stock Price Performance 39
6.4 Comparative Analysis 40
6.5 Market Value Measures 40
7. RISK FACTORS OF THE BOEING COMPANY 43
7.1 Competition 43
7.2 External Events 43
7.3 Legal/Regulatory/Government 44
7.4 Financial Risks 44
8. OVERALL APPRAISAL AND OUTLOOK 46
Bibliography 48
Appendix 50
EXECUTIVE SUMMARY
This corporate analysis provides a financial evaluation of The Boeing Company, in the period from 2006 to 2009. This analysis has been conducted based on a continuous and relevant comparison against its main competitor EADS over the considered period.
The analytical procedures used in this report include financial ratios (long-term solvency ratios, liquidity ratios, profitability ratios,
CORPORATE ANALYSIS
The Aerospace & Defense Industry
The Boeing Company
Table of Contents
EXECUTIVE SUMMARY 4
1. PRESENTATION OF THE BOEING COMPANY 5
1.1 Industry Analysis 6
1.2 Business of The Boeing Company 7
1.3 Origin and History’s Timelines of The Boeing Company 8
1.4 Management and Organizational Structure of The Boeing Company 11
1.5 The Corporate Strategy of The Boeing Company 14
2. THE SWOT ANALYSIS OF THE BOEING COMPANY 17
2.1. Strengths 17
2.2. Weaknesses 17
2.3. Opportunities 18
2.4 Threats 19
3. THE MARKET POSITION OF THE BOEING COMPANY 21
3.1 The potential threat of new sellers entering the market 21
3.2 The threat of substitute products becoming available in the market 21
3.3 The impact of the suppliers on the sellers 22
3.4 The power exerted by the customers in the market 22
3.5 The competitive intensity: the rivalry between existing sellers in the market 22
4. THE CAPITAL STRUCTURE OF THE BOEING COMPANY 25
5. THE FINANCIAL PERFORMANCE OF THE BOEING COMPANY 28
5.1 Liquidity Ratios 28
5.2 Profitability Ratios 30
5.3 Asset Turnover Ratios 33
6. STOCK PRICE PERFORMANCE ANALYSIS 37
6.1 Linear Regression Analysis and Calculation of Beta 37
6.2 The Boeing Company’s Stock Price Performance 38
6.3 EADS Stock Price Performance 39
6.4 Comparative Analysis 40
6.5 Market Value Measures 40
7. RISK FACTORS OF THE BOEING COMPANY 43
7.1 Competition 43
7.2 External Events 43
7.3 Legal/Regulatory/Government 44
7.4 Financial Risks 44
8. OVERALL APPRAISAL AND OUTLOOK 46
Bibliography 48
Appendix 50
EXECUTIVE SUMMARY
This corporate analysis provides a financial evaluation of The Boeing Company, in the period from 2006 to 2009. This analysis has been conducted based on a continuous and relevant comparison against its main competitor EADS over the considered period.
The analytical procedures used in this report include financial ratios (long-term solvency ratios, liquidity ratios, profitability ratios,
Bibliography: Boeing. (2010, Oct. 09). The Boeing Company. Retrieved from http://www.boeing.com/companyoffices/aboutus/ Business & Company resource center Chicago business. (n.d.). Retrieved 11 27, 2010, from http://www.chicagobusiness.com/article/20101117/NEWS05/101119889/boeing-787-delivery-could-be-delayed-another-year-analyst Chicago Business Chicago Business. (n.d.). Chicago Business. Retrieved 11 26, 2010, from http://www.chicagobusiness.com/article/20101110/NEWS05/101119992/boeing-stops-dreamliner-test-flights-after-emergency-landing-in-texas Datamonitor Datamonitor. (2009 ). Global Aerospace & Defense. Datamonitor . Deloitte, Touche Tohmatsu. (2010). Compass 2010, Global Aearospace & Defense sector outlook. Deloitte. Examiner. (n.d.). Examiner.com . Retrieved 11 26, 2010, from http://www.examiner.com/general-aviation-in-national/eu-voting-on-stricter-european-pilot-certification-regulations?render=print Financial Times Financial Times. (2010, 0ctober 21). Aircraft demand on the up, says Boeing. Chicago, USA: Financial Times. Payte, J. M. (2008, January). Regression Analysis and Excel. Porter, M. (1996). What is Strategy. Harvard Business Review , 77-78. PriceWaterhouseCoopers. (2010). A&D Insigths, Accelerating global growth. PWC. Ross, S. W. (2007). Modern Financial Management. McGraw-Hill Higher Education; 8 edition. The Boeing Company. (2010, Nov 06). Boeing.com . Retrieved Nov 06, 2010, from http://investor.shareholder.com/ba/stock.cfm?pageshow=financials The Boeing Company The Street Ratings. (2010). Stock valuation-Boeign CO. Thestreet.com . Thomson Reuters. (2010). Thomson Reuters. Retrieved Nov. 2010, from http://www.reuters.com/article/idUKTRE6A514K20101106?type=companyNews Thomson Reuters World Economic Forum. (2009). The Global Competitiveness Report 2009-2010. World Economic Forum. Yahoo Inc. (2010, Nov 07). Yahoo Finance. Retrieved Nov 07, 2010, from http://biz.yahoo.com/ic/610.html http://www.123helpme.com/view.asp?id=88896