Delta shares are down about 28% from their 52-week highs. Investors are waiting for air traffic to recover from the pandemic.
Yuki Iwamura/AFP via Getty Images
Delta Air Lines is considering an order of 100 737 MAX jets from Boeing , Reuters reported Friday. That would be a nice win for the commercial aerospace giant, so investors are looking favorably at the news.
Boeing (ticker: BA) stock was up about 0.8% in recent trading Friday, while Delta stock rose 1.6%. The S&P 500 was up about 0.3%. The Dow Jones Industrial Average was down about 0.2%.
Boeing and Delta declined to comment on the report.
It’s a potential positive for Boeing because Delta (DAL) doesn’t operate the MAX jet or have any on order. Delta CEO Ed Bastian said back in January on a conference call with reporters that he wouldn’t speculate about a potential MAX order.
The MAX was grounded worldwide between March 2019 and November 2020 following two deadly crashes inside of five months.
Delta operates more than 800 planes and has orders and options for roughly 400 more. (Some of the aircraft on order, of course, will replace aging jets.) Of all those jets, Delta operates almost 700 narrow-body jets, the one-aisle planes that carry the bulk of passengers. Twin-aisle jets are rarer, more expensive, and generally reserved for the longest plane routes.
All 737-model jets have one aisle.
Delta still operates more Boeing narrow-body jets than Airbus (AIR. France) single-aisle planes. But Delta has orders and options for about 220 Airbus A321 NEO jets, the closest competitor to the MAX.
A Delta order for 100 MAXes would represent a new customer for the plane and would signal to investors that the industry still believes in the jet.
Coming into Friday trading, Boeing stock was off about 5.5% year to date. Delta shares had given up about 4.9%. Boeing and Delta shares are down about 29% and 28%, respectively, from their 52-week highs, because investors are still waiting for domestic and international air traffic to recover from the Covid-19 pandemic.
Write to Al Root at [email protected]
