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Boeing said it has received a new order for two dozen 737 MAX aircraft.
Silvio Avila / AFP through Getty Images
Boeing
received a new customer for its 737 MAX aircraft, and the new order increases the shares of the commercial aerospace giant. Friday’s gain covers what has been an incredible week for Boeing stocks.
Shares of Boeing (ticker: BA) rose 6.8% on Friday. The shares have a five-day winning streak, up more than 20% in the past week. In comparison, the S&P 500 rose about 2.6%. The Dow Jones industrial average rose 4% over the same period, thanks in large part to Boeing.
Dow is a price-weighted index, and Boeing has the fourth highest share price, at about $ 270, making Boeing a relatively large component of Dow. Stock market gains this week added around 300 points from the Dow’s overall gain of almost 1,300 points this week.
The private equity firm 777 Partners is the buyer of two dozen MAX aircraft and has options for another 60 aircraft. It is fair to say that the 777 came out of nowhere: it is the company’s first Boeing order, and the 777 Partners is not a traditional airline or an aircraft locator.
Boeing referred Barron’s to his press release on the question of 777.
“We could not be more excited to work with Boeing in this transformative order for our growing aviation business,” 777 general partner Joshua Wander said in a Boeing press release. “Reducing traditional carriers globally has created an unprecedented market opportunity for more agile and cost-effective operators.”
777 Partners has more investment in low-cost airlines around the world, and MAX aircraft will be operated by those airlines. 777 Partners was not immediately available for a request for comment on its acquisition or strategy for the implementation of the aircraft.
MAX had two difficult years. It was founded worldwide in March 2019, after two fatal accidents within five months. The plane started flying again last December.
The 737 program recorded more than 500 aircraft cancellations in 2020. The pandemic, of course, decimated the demand for commercial air travel. However, Boeing has managed to generate a few additional orders or letters of intent for the MAX aircraft in the last two years.
Airlines and aircraft leases are still interested in MAX because it operates cheaper than older models, and airlines must always reduce costs. Boeing has about 4,000 MAX aircraft.
Write to Al Root at [email protected]