Last Updated 10 Jan 2022

Boeing Financial Analysis

Essay type Analysis
Words 663 (2 pages)
Views 331

Boeing Corporation is a major aerospace and Defense Corporation, founded by William Boeing 1916. Boeings headquarters are located in Chicago, Illinois, USA. Boeing is involved in the production of commercial airliners, military aircraft, munitions, space systems and computer services. Based on revenue Boeing is the largest aircraft manufacturer in the industry-Boeings stock is part of the Dow Jones Industrial Averages and Boeing is the largest exporter in the U. S.

Total revenue changed between 2005 -2006 increased by $6,685,000but also Cost of Goods Sold increased by $4,588,000 in 2006. So the Gross Profit by the end of 2006 increased by $2,097,000 . The main change in operating expenses was non-recurring expense that went from ($520,000,000) to $797,000,000 and also research and development increased by $1,052,000 due to these changes the operating income was lower than in 2005. Boeing co debt decreased by $413,000 at the end of 2006, so due to this the income before tax increased.

Expense from discontinued operations went from ($7000000) to $9000000 , and in 2006 Boeing decreased their net income with no cost of affect of accounting changes that were previously incurred in 2005. Net income decreased by $357000000. Boeing does not hold preferred stock. All net income is distributed only to common stock holders or in retained earnings. Total current assets from 2005-2006 increased by $1,015,000. This was caused by increase in cash and cash equivalence, net receivables, inventory and other current assets.

Order custom essay Boeing Financial Analysis with free plagiarism report

GET ORIGINAL PAPER

Total assets decreased by $8,264,000 and were due to long term investments decreasing during 2006 property plant and equipment decreased. Other assets, on the such as good will and intangible assets increased. Accounts payable decreased by the end of 2006 and on the hand Boeing co. had other current liabilities that increased $5,706,000 due to that total current liabilities increased only $1,513,000. In 2006 Boeing did not have any deferred long term liability charges such as in 2006. Total liabilities' at the end of 2006 decreased $1,944,000.

In 2006 common stock is the same as in 2005 and retained earning slightly increase.. In 2006 total stockholders equity decreased by $6,320,000 mainly due to the increase in a negative other stock holder equity figure.

Total cash flow from operating activities at the end of 2006 remained stable, but total cash flow from investing activities in 2006 increased by $3,088,000 mainly due to the change in other cash flows from investing activities that went from $1 ,590,000 to ($1,540,000).

Total cash flows from financing activities decreased by approximately $1bil due to decreasing sale purchase of stock.

The price earnings is the relationship between the stock price and the company's earnings. P/E ratio gives an indication of future of earnings of a company. Boeing price earnings ratio is 17. 35 compared to the industry which is 18. 77 what this means is that the market value of each share would be (17. 35* $1)= $17. 35 the market value of each share f or the industry would be (18. 77*$1)=$18. 77

The market/book ratio is the ratio of the current share price to the book value per share. A company with higher market to book ratio is more likely to issue equity, because they have less external financing options but a low market to book ratio means that the company is profitable and will issue more debt. Market to book value is book value which is Total Assets -intangible assets-total liabilities The higher the ratio the company can better manage their short term debt obligations, which doesn't mean that Boeing has difficulty meeting its current obligations.

Boeing borrowing funds provides financial flexibility; this was the same for 2006. Boeings quick ratio is much lower than the industry's; increasing debt would not change this but worsen it. Boeings current ratio is 0. 8 which is 80 cents for every dollar of short term liabilities. Boeing may have a short-term asset problem. The problem may be due to high inventory or unproductive use of inventory; this is reflected in its turnover ratios which is considerably lower than the industry.

Related Questions

on Boeing Financial Analysis

What are the benefits of financial analysis?

The benefits of financial statement analysis are that it can help your business thrive. Through financial statement analysis you can determine and identify financial strengths, weaknesses and relationships that exist in your company. The Current Ratio analysis is your total current assets divided by the current liabilities on your balance sheet.

How do you do financial statement analysis?

Financial Statement Analysis. Analysts do this by dividing debt, which comes from the balance sheet, by net income, which comes from the income statement. Likewise, return on assets (ROA) and the return on equity (ROE) compare company net income found on the income statement with assets and stockholders' equity found on the balance sheet.

What is financial analysis experience?

DEFINITION of 'Financial Analysis'. Financial analysis is the process of evaluating businesses, projects, budgets and other finance-related entities to determine their performance and suitability. Typically, financial analysis is used to analyze whether an entity is stable, solvent, liquid or profitable enough to warrant a monetary investment.

What is Finance Analysis?

Financial analysis. Financial analysis (also referred to as financial statement analysis or accounting analysis or Analysis of finance) refers to an assessment of the viability, stability and profitability of a business, sub-business or project.

This essay was written by a fellow student. You can use it as an example when writing your own essay or use it as a source, but you need cite it.

Get professional help and free up your time for more important courses

Starting from 3 hours delivery 450+ experts on 30 subjects
get essay help 124  experts online

Did you know that we have over 70,000 essays on 3,000 topics in our database?

Cite this page

Explore how the human body functions as one unit in harmony in order to life

Boeing Financial Analysis. (2018, Apr 13). Retrieved from https://phdessay.com/boeing-financial-analysis/

We use cookies to give you the best experience possible. By continuing we’ll assume you’re on board with our cookie policy

Save time and let our verified experts help you.

Hire writer