Is Boeing's Growing Backlog Strengthening Its Recovery Prospects?

The Boeing Company BA appears to be steadily advancing toward an operational recovery, supported by robust customer demand and a continued improvement in aircraft deliveries. For aerospace manufacturers, maintaining a substantial backlog is particularly critical, as aircraft production typically involves lengthy manufacturing timelines and considerable upfront capital investments.

Boeing ended first-quarter 2026 with a record backlog of $695 billion, including more than 6,100 commercial airplanes. This reflects sustained demand from airlines, defense customers and global aviation markets. BA expects nearly 24% of the backlog to be converted to revenues through 2027 and nearly 65% through 2030, with the remainder thereafter.

Commercial aircraft deliveries were a key contributor to the company’s quarterly improvement. In the first quarter, the company delivered 143 aircraft, reflecting a 10% increase from the prior-year level. The rise in deliveries drove Commercial Airplanes revenues up 13% year over year to $9.2 billion.

During first-quarter 2026, Boeing’s Defense, Space & Security segment generated revenues of $7.6 billion, up 21% year over year. The company also benefited from continued demand for defense platforms, missile systems and government-backed programs.

Boeing Global Services generated revenues of $5.4 billion during the quarter. The segment continues to provide stable recurring revenues through aircraft maintenance, training and aftermarket support activities.

This diversified business model enables Boeing to lessen its dependence on any one market cycle. The company’s rising delivery volumes and growing backlog indicate that it may steadily strengthen its financial stability.

Defense Giants Continue to Benefit From Record Backlogs

Rising global air travel demand and increasing defense spending continue to support major aerospace companies. A few aerospace and defense companies benefiting from these trends are discussed below:

RTX Corporation RTX operates across commercial aerospace systems, defense technologies and aviation services, helping diversify its revenue sources. RTX reported a backlog of nearly $271 billion as of March 31, 2026. 

Lockheed Martin LMT reported a backlog of roughly $186.4 billion as of March 31, 2026, supported by fighter aircraft, missile systems and classified defense programs.

BA Stock’s Earnings Estimates

The Zacks Consensus Estimate for 2026 and 2027 EPS indicates a year-over-year improvement of 98.6% and 2,813.2%, respectively.

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BA Stock Trades at a Discount

In terms of valuation, BA’s forward 12-month price-to-sales (P/S) is 1.66X, a discount to the industry’s average of 2.45X.

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BA Stock’s Price Performance

In the past six months, the company’s shares have risen 19.9% against the industry’s 5.7% decline.

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BA’s Zacks Rank

The company currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
 

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This article originally published on Zacks Investment Research (zacks.com).

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