Tue, 19 Jan 2021

Boeing shares down nearly 20% since fatal plane crashes

Lola Evans
22 Oct 2019, 19:09 GMT+10

Brokers were busy downgrading Boeing shares on Monday after news broke on Friday that the company was aware of a major fault with its 737 Max jets well prior to two major plane crashes which killed hundreds of people.

Brokers said in notes circulated Monday that Boeing may have to make provision for billions of dollars of losses more than previously thought.

Credit Suisse and UBS reportedly downgraded Boeing stock following extensive media reporting of text messages to and from Boeing employees raising concerns about the plane's anti-stall system.

Chief Executive Officer Dennis Muilenburg in an email to Boeing employees on Monday addressed the texts, advising employees that had concerns about them and the media coverage to talk to management.

He said the company was investigating the texts.

The CEO told employees steady progress was being made towards getting the 737 Max jets back into the air.

Boeing shares are down nearly 20% since the second of the two fatal crashes.

The aircraft has been banned since then and the company has cut back on production in the light of cancellations.

"We see increasing risk that the Federal Aviation Administration won't follow through with a certification flight in November and lift the emergency grounding order in December," UBS analyst Myles Walton said in a note to clients. He downgraded the stock from "buy" to "neutral."

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