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Investing.com - UBS maintained its Buy rating and $280.00 price target on Boeing (NYSE:BA), currently trading at $229.40, as the aircraft manufacturer invests $1 billion to boost 787 Dreamliner production at its Charleston facility. According to InvestingPro data, Boeing’s stock has surged nearly 50% over the past six months, reflecting strong market confidence.
The investment aims to increase production capacity to 16 aircraft per month by 2028, which would represent a record production level for the 787 program, according to UBS.
Boeing’s current backlog of 1,000 787 aircraft, including more than 600 orders received in the past three years, provides visibility to support the targeted production rate into the early 2030s.
UBS projects that demand for the 787 will be sustained by a combination of 3% fleet growth and 3% replacement rates, which aligns with historical averages for widebody aircraft.
The production increase could generate $4 billion in free cash flow growth for Boeing between 2029 and 2033, while also benefiting suppliers including Hexcel, Howmet Aerospace, Leonardo, and Toray, UBS noted.
In other recent news, Boeing has been awarded a $44.9 million contract modification for the remanufacture of Apache AH-64E aircraft and a Longbow Crew Trainer, increasing the total contract value to over $3.1 billion. Additionally, Canadian airline WestJet has expanded its fleet with an order for 67 Boeing aircraft, including 60 737-10 jets and seven 787-9 Dreamliners, with options for more. The Federal Aviation Administration (FAA) has not yet decided on lifting the production cap of 38 planes per month for Boeing’s 737 MAX aircraft, which has been in place since early 2024. Meanwhile, Boeing Defense plans to hire new workers to replace striking machinists in the St. Louis area. The strike involves approximately 3,200 members of the International Association of Machinists and Aerospace Workers who rejected Boeing’s latest contract proposal. The FAA is also planning to propose changes to speed up the certification process for new commercial airplanes, aiming to modernize certain standards. These developments highlight Boeing’s ongoing activities and challenges in both commercial and defense sectors.
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