Bizjet Recovery ‘Taking Hold,’ Says JPMorgan

AINalerts » March 8, 2011
March 8, 2011, 7:14 AM

“We are gaining confidence that a recovery is taking hold following good news in recent weeks,” JPMorgan North America Equity Research noted in its latest monthly business jet update, released yesterday. The firm cited the net orders for 74 aircraft booked by Bombardier in the fourth quarter, as well as the firm order for 50 Bombardier Globals placed by NetJets last week. “We believe demand is at least starting to improve more broadly…and [the recent uptick at Bombardier] takes place in the context of an improving economic outlook and rising corporate profits, which bode well for demand.” Still, JPMorgan analysts are “not popping the champagne just yet,” mainly because 11 percent of in-production aircraft are for sale on the second-hand market–3 percentage points above the 15-year average, though 0.3 points below January inventory levels–“at [low] prices not seen since the late 1990s.” JPMorgan wants to see used inventory continue falling and prices rise, along with further evidence of new-aircraft backlog stabilization, “to move beyond our current state of cautious optimism.”

FILED UNDER: 
Share this...

Please Register

In order to leave comments you will now need to be a registered user. This change in policy is to protect our site from an increased number of spam comments. Additionally, in the near future you will be able to better manage your AIN subscriptions via this registration system. If you already have an account, click here to log in. Otherwise, click here to register.

 
X