Intel stock extends gains after report of possible U.S. government stake
On Friday, Bernstein analysts maintained their Market Perform rating on Boeing (NYSE:BA) stock (currently trading at $159.35), alongside a steady price target of $179.00. With a market capitalization of $121 billion, Boeing remains a prominent player in the Aerospace & Defense industry, though InvestingPro data shows the stock has experienced significant volatility with a beta of 1.53. The aerospace giant has been under scrutiny, with production rates of its 737MAX aircraft being a focal point for investors. According to Bernstein, there is optimism about Boeing increasing production to 38 planes per month, a target initially expected to be met by July. However, recent discussions with airlines at the ISTAT conference indicate that this milestone could be achieved as early as May or June, with Southwest Airlines (NYSE:LUV) suggesting April as a possibility.
Despite these optimistic projections, the analysts express caution, deeming an April target challenging based on the production levels observed in March and February. Nonetheless, the progression toward increased production is seen as a positive development. According to InvestingPro data, analysts anticipate sales growth of 27% in the current year, though the company’s overall financial health score remains weak at 1.07 out of 5. Additionally, Bernstein noted that Boeing has continued deliveries to China, including 777 Freighters and a 787, during January and February, actions that are beneficial for the company’s cash flow. However, the report highlighted that there have been no recorded deliveries to China in March.
The report also touched on the potential for Boeing to engage in asset sales, with the sale of Jeppesen being a possibility. Jeppesen, a subsidiary providing navigational information, operations planning tools, and flight planning products, could fetch a price over $7 billion. The success of such sales will largely depend on the prices achieved, as pointed out by the analysts.
Boeing’s stock performance and future outlook continue to be influenced by its production rates, delivery schedules, and strategic financial decisions such as asset sales. The steady price target reflects Bernstein’s current view on the stock’s valuation based on these factors. Based on current metrics, InvestingPro analysis suggests Boeing is slightly overvalued, with analyst targets ranging from $103 to $250 per share. Get access to 8 more exclusive ProTips and a comprehensive Pro Research Report covering Boeing’s complete financial picture through an InvestingPro subscription.
In other recent news, Boeing reported a significant increase in aircraft deliveries for February, with a total of 44 planes delivered compared to 27 in the same month last year. This includes 32 of the 737 MAX jets and five 787 widebody planes. The company is focusing on stabilizing and increasing production of these models. In a separate development, the US Federal Aviation Administration has proposed inspections for Boeing’s 787 Dreamliner due to reports of nonconformities in the forward pressure bulkhead. Boeing had already advised operators to conduct visual inspections following a multiyear review.
Additionally, Citi analysts have maintained a Buy rating on Boeing stock with a $210 price target, citing underestimated long-term growth potential. Boeing’s growth prospects in commercial aerospace and defense are seen as promising by Citi, with projected increases in airline fleet size and the Department of Defense budget. Meanwhile, Boeing is also assessing the impact of a fire at a parts factory in Philadelphia, which could strain the aerospace supply chain further. Lastly, Boeing remains in the running to design the U.S. Navy’s next-generation fighter jet, alongside Northrop Grumman (NYSE:NOC), after Lockheed Martin (NYSE:LMT) was excluded from the competition.
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