Despite a posting a strong fourth-quarter profit that surpassed expectations, Boeing Co.'s its shares dropped more than 5% during trading Wednesday as investors grew leery of forecasts for 2014.
The Chicago aerospace giant said its earnings — excluding some pension expenses — are expected to be $7 to $7.20 a share this fiscal year, far short of analysts' average estimate of $7.57.
Investors sold off shares on the conservative expectations, and the stock closed down $7.31, or 5.3%, at $129.78. The stock hasn't experienced such a severe decline since 2011.
Adding to investor concerns was Boeing's projections that operating cash flow will fall from $8.18 billion in 2013 to about $6.25 billion. The estimate came despite plans to deliver 715 to 725 airplanes in 2014, up from last year's record of 648.
In 2013, Boeing earned $5.96 a share on revenue of $86.62 billion.
In Wednesday's conference call with analysts, Chief Executive Jim McNerney said Boeing had hit its targets for 2013.
"We successfully delivered on our strategies to convert our record backlog into profitable growth, executed well on commercial and defense development programs and drove productivity and affordability gains throughout our business and enterprise functions," he said.
In the fourth quarter, Boeing reported earnings of $1.23 billion, or $1.61 a share, up 26% from $978 million, or $1.28, a year earlier. Revenue rose 7% to $23.79 billion.
Boeing does not plan to announce new designs for its jetliners in 2014 like it did last year with updated versions of its top-selling wide-bodies, which spurred new orders. The company launched the 777X with 259 orders..
It is speeding production lines to reduce its record $374-billion backlog. The 737 program is now delivering at a record production rate of 38 a month, with plans to go to 42. Boeing expects to deliver 110 of its 787 Dreamliners, up from 65 last year.
Boeing is one of the largest private employers in Southern California, including a factory that produces the C-17 cargo plane in Long Beach, facilities in Huntington Beach and a sprawling satellite operation in El Segundo.
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