Aerospace giant Boeing suffered a significant cash burn in the first quarter of 2024, depleting its cash reserves by over $8 billion to a mere $7.5 billion. Despite reporting an $8% year-over-year revenue decline to $16.57 billion, Boeing’s defense, space, and security division managed to sustain an operating profit. However, the company’s commercial unit recorded a 31% revenue drop due to issues plaguing its 737 production line, leading to a loss of $1.13 per share.
NIO, the Chinese electric vehicle (EV) manufacturer, has been downgraded to “Strong Sell” due to its deteriorating fundamentals, market share loss, and unsustainable business model. Despite reporting revenue growth in 2023, NIO lagged behind the overall Chinese EV market, with its market share declining significantly. The company continues to burn cash, leading to concerns about its financial stability. Additionally, NIO’s revenue growth has not been accompanied by improved profitability, raising doubts about the long-term sustainability of its business model. While discounted cash flow analysis suggests the stock is undervalued, this discount is considered fair given the significant risks facing NIO.
