The Boeing Company (BA) is a global aerospace leader and one of the largest defense contractors in the U.S. Based in Arlington, Virginia, Boeing is famed for its top-tier jet aircraft like the 737, 747, 777, and 787 Dreamliner. Valued at $114.35 billion by market cap, Boeing offers both commercial aircraft and a diverse array of defense products. Its clients include domestic and international airlines, the U.S. Department of Defense, the Department of Homeland Security, NASA, aerospace prime contractors, and government and commercial communication entities.
Boeing has underperformed the broader market over the last year. The stock has declined 9.5% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 26.6%. In 2024 alone, the stock has lost 28.5%, compared to SPX's 11.3% gains on a YTD basis.
Narrowing the focus, BA lagged behind the iShares U.S. Aerospace & Defense ETF (ITA) 20.9% return over the past year. Also, the stock's YTD loss is far behind the exchange-traded fund's 7.9% returns over the same time frame.
Boeing’s disappointing earnings and the challenge of meeting free cash flow targets led to the stock’s 13% decline in April. The potential acquisition of Spirit AeroSystems raised supply chain stability concerns amid Spirit's financial woes.
On Apr. 24, Boeing reported its Q1 results, surpassing Wall Street's EPS estimates but missing the revenue consensus. The stock declined 2.9% on the day it released earnings but closed the following trading session with a 1.5% increase.
For the current fiscal year, ending in December, analysts anticipate BA's loss to narrow 89.7%, reaching $0.60 on a diluted basis. The company’s earnings surprise history is mixed. It beat the consensus estimate in three of the last four quarters while missing the forecast on another occasion.
Among the 22 analysts covering BA stock, the consensus rating is a “Moderate Buy.” That’s based on 14 “Strong Buy” ratings, one “Moderate Buy,” six “Holds,” and one “Strong Sell.”
This configuration has been slightly less bullish over the past three months, with the consensus rating being a “Strong Buy.”
On May 21, Cai von Rumohr from TD Cowen reiterated a “Buy” rating on Boeing with a price target of $230.00, which indicates a 23.5% upside from the current levels.
The mean price target of $225.65 represents a 21.1% premium to BA’s current price levels. The Street-high price target of $270 suggests an ambitious upside potential of 44.9%.
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