While the prevailing sell-side narrative as General Electric's (GE) guidance approaches is that the 737 Max production cut is negative, the "simple math" suggests it should have a positive influence, both in 2019 and in 2020, up to $600M in segment profit versus the guidance issued in last March, JPMorgan analyst Stephen Tusa tells investors in a research note titled "MAX Math: Should Be A Positive Near Term, Negative Long Term, Opposite Of Prevailing Narrative." The key is the difference between engine production, engine deliveries to Boeing (BA), and Boeing deliveries to customers, "with several moving parts suggesting near term upside," says Tusa. However, this performance is unsustainable and timing related, the "opposite of the narrative of near-term pressure with longer-term upside," he adds. Tusa believes the "growing narrative" that Max is a negative today, and anything reported will be "better than feared" with future upside "is not supported by the math." There is more to the GE story that will need to be watched into and out of earnings, with many of these items positive but timing-related near term, and unsustainable longer term, contends the analyst.

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Get caught up quickly on the top news and calls moving stocks with these five Top Five lists. 1... To see the rest of the story go to thefly.com. See Story Here

Says without approximately $200M impact Boeing (BA) 737 MAX 9 from grounding, United (UAL) would have reported a quarterly profit.

Northcoast downgraded Boeing to Sell from Neutral with a $140 price target. The stock in premarket trading is down 1% to $168.80. The analyst expects Boeing's quarterly earnings report in two weeks to prompt concerns about the company's underlying fundamentals and ultimately shift investor focus to liquidity and acquisition concerns. Negative expectations are embedded in the lower share price, but investors may not be discounting structural issues, such as Boeing's balance sheet stability or future cash liabilities, the analyst tells investors in a research note. Northcoast believes the 787 production challenges and the Federal Aviation Administration investigation uncertainties do not appear to be reflected in consensus estimates. The firm's channel checks confirm unexpected changes were already made to the Dreamliner production schedule "that would normally indicate some type of problem not yet been communicated to The Street." Its survey results point to a 787 program build rate of two jets per month, as opposed to Boeing's claim of five.

Northcoast analyst Chris Olin downgraded Boeing to Sell from Neutral with a $140 price target.