Why Shares of Boeing Are Falling Today
Shares of Boeing (NYSE: BA) fell more than 5% on Tuesday as investors continue to try to calculate how much damage the COVID-19 pandemic will do to commercial aircraft order books. Boeing's commercial arm accounts for two-thirds of total revenue, and the company is sure to take a sustained hit if demand for new planes falters.
Boeing shares have lost more than half their value since March 1, pulled down along with airline stocks as the pandemic has brought travel to a halt. Even after the pandemic is contained air travel is unlikely to return quickly, which is causing airlines to ground planes and cut capital expenditures.
We've already seen some evidence that Boeing's order book will take a hit, with airplane leasing giant Avolon earlier this month canceling orders for 75 737 Max planes. With each passing day we are seeing fresh evidence to suggest there will be a glut of used jets on the open market whenever airlines decide the time is right to expand again.
Source Fool.com
