Airbus share price analysis: sky is the limit as backlog spikes

Airbus (ETR: AIR) share price is hovering near its record high as the company’s backlog continues rising. The stock jumped to a record high of €144.12, about 30% above its lowest point in 2023. It has underperformed Boeing, whose stock has jumped by over 35% this year.

The biggest catalyst for the Airbus stock price was the big order from EasyJet, one of the biggest regional airlines in Europe. The company’s shareholders voted to allow the company to purchase 157 new planes in an order valued at over $20 billion.

The news came on the same day that Lufthansa made a giant order from Airbus and Boeing. It ordered 80 planes in a deal valued at over $9 billion. This means that the company is now operating in full capacity as demand for planes rise.

In November, Airbus said that it had delivered 488 commercial aircraft in the first nine months of the year. Its total revenues rose to over €42.6 billion while its reported EBIT was over €2.7 billion.

The company had a total order backlog if 7,992 commercial aircraft and 191 net orders of helicopters. Also, its defense business continued doing well as the ongoing geopolitical challenges led to a major increase in defense spending. 

The challenge for Airbus – and Boeing – is that it relies on external suppliers for key parts. As a result, there is a major risk that some of its suppliers will struggle to match the soaring demand. In June, the company warned about longer lead times for steel deliveries. The firm sees these supply chain issues lasting until 2024.

Still, I suspect that the company’s business will continue doing well in the coming months. Besides, inflation is falling, making it relatively affordable to build its planes. There are also signs that central banks will slash interest rates in 2024.

The daily chart shows that the Airbus stock price has been in a strong uptrend in the past few months. It recently crossed the important resistance point at €138.82, its highest point on July 25th of this year. Most importantly, it has retested this level, which is a positive sign.

Airbus stock is also being supported by the 50-day and 100-day Exponential Moving Averages. It has also remained above the Ichimoku cloud. Therefore, the outlook for the stock is bullish, with the next crucial level to watch being at €150.

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