Benchmark cuts Boeing stock price target to $215 from $250

On Monday, Benchmark analyst Josh Sullivan adjusted Boeing’s (NYSE:BA) price target to $215 from the previous $250, while still endorsing the stock with a Buy rating. According to InvestingPro data, 11 analysts have recently revised their earnings estimates downward, with the stock currently trading at $161.90. Based on InvestingPro’s Fair Value analysis, Boeing appears to be overvalued at current levels. Sullivan’s analysis acknowledges the ongoing challenges faced by Boeing, including tariff complexities, the Federal Aviation Administration’s (FAA) decision to maintain the production cap on the 737-MAX at 38 units per month, the reluctance of China to accept deliveries, and various supply chain issues. These issues range from engine supply constraints to the repercussions of a recent fire at a key fastener supplier. These challenges have contributed to Boeing’s weak financial health score, as revealed by InvestingPro’s comprehensive analysis, with negative gross profit margins and no profitability over the last twelve months.

The analyst pointed out that the fiscal year 2025 was expected to mark Boeing’s resurgence under CEO Dave Calhoun, formerly known as Ortberg, and its reaffirmation as a dominant force in the global corporate landscape. However, current industry headwinds have prompted a more cautious outlook. Despite these setbacks, Sullivan noted that Boeing, much like its main competitor Airbus, has the capacity to shift geographic delivery preferences to mitigate the impact of tariffs on its market.

Sullivan also emphasized the enduring nature of the market duopoly between Boeing and Airbus, suggesting that the long-term industry cycle remains favorable. He also mentioned that Boeing’s production levels could still be considered conservative relative to the actual long-term market demand, despite potential short-term fluctuations in consumer interest. With a market capitalization of $121.81 billion and annual revenue of $66.52 billion, Boeing remains a prominent player in the Aerospace & Defense industry, though its beta of 1.24 indicates higher volatility than the broader market.

The medium-term outlook raises concerns about the availability of GE Leap engines and the potential impact of the SPS Fastener fire, which may become more significant in approximately six months. However, Sullivan remains optimistic about Boeing’s long-term prospects, highlighting the company’s focus on free cash flow (FCF). The analyst’s revised price target is based on projected FCF of $5.3 billion in fiscal year 2026, with a multiple of 29 times, and $10 billion in fiscal year 2027, with a multiple of 15 times. Sullivan concluded by reaffirming a positive stance on Boeing’s long-term cycle, despite the near-term disruptions that have necessitated a reduction in the price target. For deeper insights into Boeing’s financial health and future prospects, including exclusive ProTips and comprehensive valuation metrics, explore the full research report available on InvestingPro.

In other recent news, Boeing has reported a significant increase in jet deliveries for the first quarter of 2025, totaling 130 commercial airplanes and 26 defense units. This includes 104 of the 737 MAX aircraft, marking a substantial improvement from the previous year’s first quarter. The company is set to release detailed financial results on April 23, which will confirm these delivery figures. Meanwhile, Boeing faces challenges as China has halted the acceptance of its jets due to escalating trade tensions between the United States and China. This decision could impact Boeing’s future sales in the region. Additionally, Howmet Aerospace, a supplier for Boeing, might suspend some shipments due to tariffs imposed by the U.S. government. These developments highlight the complex landscape Boeing navigates amid geopolitical tensions and operational recovery. Investors are closely watching these factors as they assess Boeing’s financial health and market performance.

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