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Boeing's Guidance Crash Lands


The earnings parade will yield some casualties.


Editor's Note: The following was posted in real time on our premium Buzz & Banter (click for a free trial). It's being shared here for the benefit of the Minyanville community.

Greetings from New York, where I remain at a loss as to how I could talk about Boeing (BA) without sneering. The company reported a jaw-dropping loss of $1.5 billion, managing to actually miss EPS despite the huge $3.6 billion write-down of the 787 being expected by analysts. Boeing also announced lower guidance for the year, blaming the problem on "dwindling demand in its commercial airplane and defense business".

The upside? That Dreamliner is going to be cool, as soon as Boeing's engineers learn how to keep the wings on it. Here's what else I'm watching as I prepare for an afternoon out of the office:

  • I'm going to miss McDonald's (MCD) report. I'm still long the stock despite fellow multinational Coca-Cola (KO) reporting a fizzless quarter earlier in the week. I don't get all that nervous about positions at this point, but I can see a bit of a tantrum coming on if Micky D's fails.

  • One position I'm not worried much about? The USO oil ETF. Bad dollar, ever-present demand, and an ongoing love affair between Americans and big cars that can crush things all work in favor of higher oil prices. In the same vein I'm cool with my gold ETF, the GLD. The dollar trade may be late, but it hasn't exactly reversed trend and the trend is very much lower. For now I'd rather sit in proxies for oil and gold than cash.

  • Then again if I lived in, say, France I'd be plenty content to stay in Euros.

  • My bestest buddies at Disney (DIS) are on the verge of unveiling "Keychest", a device they promise will make consumers use their DVDs as coasters or lousy Frisbees. Disney hasn't had much success with devices in the past, but this one sounds like a winner. As it turns out, "digital" is a big deal.

  • With that, I'm off to scurry all about Westchester. Have a safe and productive day, Minyans. And no one email me McDonald's results; I want to squint at the news with a sense of dread myself.

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Positions in USO, GLD, MCD and DIS

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