(News Bulletin 247) – The European aircraft manufacturer has announced that it delivered 63 aircraft in the fifth month of the year, significantly increasing the pace compared to April. What analysts consider reassuring.

Airbus clearly upped the tempo in May. The aeronautics and defense group published its deliveries and orders for the month of May on Wednesday, a publication still closely watched by the market.

It should be remembered that most of the payment for an aircraft occurs when it is received in good and due form by the customer (even if installments are paid when the contract is signed). The more planes an aircraft manufacturer delivers, the more cash he earns.

But in the fifth month of the year, the group led by Guillaume Faury managed to pick up the pace. In May, Airbus delivered 63 aircraft, 17% more than in April, when the group reached 54 units.

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Logistic tensions

This increase in the rate encourages some optimism, while Airbus has been struggling for almost two years with various tensions on its supply chain which is slowing down the ramp-up of its production of aircraft, in particular single-aisle aircraft. These difficulties are at various levels, whether at the level of raw materials, recruitment, or products such as engines and seats. Guillaume Faury, the executive chairman of Airbus, indicated in May that these tensions could continue until 2024.

The level of deliveries of 63 in May is slightly higher than the 62 units expected by Bank of America but lower than that expected by Jefferies (67).

On the Paris Bourse, the Airbus share opened in the green before erasing its gains and falling 0.3% around 10:15 a.m., a decline in line with that of the CAC 40.

Nevertheless, Jefferies considers that the group’s performance remains “solid” and places for the first time this year all of the deliveries made by the group since January 1 (i.e. 244) up compared to the same period of 2022. “Deliveries of jumbo jets have started to resume”, also appreciates the design office. In addition, with this figure of 63 units, Airbus is within the monthly average necessary to achieve its objective of 720 aircraft for 2023, adds Jefferies.

Admittedly, Airbus still has to deliver 476 aircraft over the remaining seven months. But the group is used to completing its exercises with a bang to meet its objectives, with the notable (and resounding) exception of 2022. Guillaume Faury had also warned last month that the profile of Airbus deliveries would be concentrated on the last quarter, in particular because the months of July and August are logically penalized by the summer holiday periods for employees.

Le Bourget as a catalyst?

Deutsche Bank, for its part, judges the figures for May as “encouraging” and has also raised its target price to 127 euros against 125 euros previously. The bank calculates that 66% of annual delivery volumes must still be made between June and December, a proportion in line with the average (65%) of each year since 2014.

It should be noted that in terms of orders, Airbus posted 178 gross orders and 144 net orders over the first five months of the year, the difference being due to 34 order cancellations.

These figures could change greatly with the holding in a little more than a week of the Paris Air Show, an event traditionally supplier of orders. Many orders for several hundred aircraft could thus be announced during this show, which will hold its first edition since 2019.

Bank of America expects this event to be a positive catalyst for Airbus stock. The American bank estimates that the aircraft manufacturer could confirm its delivery target by the end of 2024 at 65 aircraft. The value is also part of the list of “best ideas” investment Bank of America for the second quarter.