Boeing stock jumps premarket on Delta deal

Yahoo Finance Live anchors discuss Boeing's stock performance.

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- We're a few minutes away from the opening bell on Wall Street and one that could be a potentially positive start to the trading week after some decent-- I'll say decent earnings from the banks this morning, Bank of America and Goldman Sachs. But watching a couple of other movers here. Let's start with Boeing. Shares of Boeing in focus after Delta Airlines said it will buy at least 100 of the plane maker's 737 MAX Jets to add to its fleet.

As Delta continues to deal with high fuel and labor costs, CEO Ed Bastian says, quote, "It's an important addition to Delta's fleet as we shape a more sustainable future for air travel with an elevated customer experience, improved fuel efficiency, and best-in-class performance." So you couple this news, guys, with CEO [? of ?] Boeing, CEO Dave Calhoun, giving a pretty bullish take to the FT on the state of demand, Boeing shares clearly deserve to be in focus.

- Yeah, a few things swirling around Boeing here on the day, and certainly with the Delta order. And I had actually asked Delta CEO Ed Bastian about that last week, just kind of trying to get ahead of what may come in the future. Clearly that being announced. But they were really focused on the Airbus 321neos, having over 150 of those aircrafts on the way already, taking some of that order already in this most recent quarter.

So you combine that with the Boeing 737 MAX, and they're really going to be looking for this fuel efficiency. Improvement in customer amenity and satisfaction is what, of course, the executive team would lean into. But I think it really just comes down to how they're going to also use the future of these aircrafts in some of their pilot negotiations as well, really trying to unlock that pipeline also.

- The backdrop for all of this, by the way, is the Paris Air Show, right? And that is always a big blockbuster. It's the first time it's being held, by the way, since 2019. Always a lot of deals come out of this. And there are two main planemakers. We're talking about Boeing on the one hand and Airbus on the other. And $21 billion worth of orders is what's at stake here at this show.

A lot of the orders tend to get signed kind of going into it. But there is some jockeying and deal-making that's made at the show. And these two are just in consistent and constant competition for this stuff. Obviously Boeing's been on the back foot the past few years. So it is trying to push forward and get some of these deals signed.

So we'll have to see what ends up coming out of the air show when all is said and done. But I think we mentioned sustainability in that quote from Bastian. And that's definitely a big topic, there, especially since where they're gathering is the subject, as is so much of the globe, of a heat wave right now. So that sustainability of all of these big new planes is very much on their minds.

- Yeah, and I'll add this, too. Look, if Delta thought there was going to be a recession or a deep recession, they're not out here ordering 100 planes.

- No. And they get delivered over multi-year agreements, too. So even then, with the Airbus 150 planes that they ordered, they have them on the way. But as you continue to look through when those get delivered and when they get implemented into flight schedules and the training that's also factored into those schedules as well, I think that's exactly where, over time, recession or not, they're going to be planning for this well in advance.

- There's also some optionality built in these contracts. So it's not like an ironclad we're--

- You will take these 100 planes, or we will find you.

- We don't-- we tend to-- and they don't usually tell us directly how much they're paying for these planes. It tends to be reported on, and we don't get all the details. So there definitely could be some caveats within that contract.