Stifel maintains Boeing buy rating with $235 target

On Tuesday, Stifel, a financial services company, reaffirmed its Buy rating on Boeing (NYSE:BA) with a steady price target of $235.00. The firm's analyst highlighted Boeing's delivery performance for July, which met market expectations. Boeing delivered a total of 43 aircraft for the month, including 31 units of the 737 MAX, one 737-800A, two 767 Freighters (767Fs), two Tankers, one 777 Freighter (777F), and six 787s.

The report noted that Boeing has managed to stabilize its aircraft deliveries over the last two months. This has been attributed to the utilization of inventory that was previously designated for markets in China and India, as well as a slight improvement in production.

The company is anticipated to see continued sequential production enhancements from July through the end of the year. This includes the potential for growth into the third 737 production line at its Renton facility, along with a gradual reduction of inventory in the upcoming months.

The analyst pointed out that while the number of 737s delivered in July decreased by three compared to June, the delivery of 787s increased by the same number. This balance is expected to improve as the year progresses, particularly in the fall, provided there are no disruptions from the ongoing negotiations with the International Association of Machinists and Aerospace Workers (IAM).

In addition to the delivery update, Boeing has also secured a significant order from Poland, valued at approximately $10 billion, for Apache helicopters. This deal is expected to bolster the prospects of Boeing's Defense, Space & Security (BDS) division in the latter part of the decade.

In other recent news, Boeing has been in the spotlight with several significant developments. The company landed a $2.56 billion contract from the United States Air Force to deliver two E-7A Airborne Early Warning and Control (AEW&C) Wedgetail aircraft. This contract includes the production of the aircraft, lifecycle development, training, and support for the U.S. E-7A fleet.

On a different note, Boeing is likely to miss its production target for the 737 MAX jet by the end of 2024, according to Moody's (NYSE:MCO) Investors Service and S&P Global Ratings, with the target achievement anticipated in the latter half of 2025. Meanwhile, Poland has secured an arms deal with the United States, which includes the purchase of 96 AH-64E Apache attack helicopters from Boeing.

Adding to the company's activities, Bernstein SocGen Group has maintained an Outperform rating on Boeing shares, emphasizing the need for cultural transformation within the company. The National Transportation Safety Board (NTSB) is also set to finalize its investigation into a mid-air emergency involving an Alaska Airlines Boeing 737 MAX 9 aircraft by early 2025. These are among the recent developments impacting Boeing's operations and future prospects.

InvestingPro Insights

As Boeing (NYSE:BA) continues to navigate through its production and delivery challenges, the latest data from InvestingPro provides a nuanced perspective on the company's financial health. With a market capitalization of $103.75 billion, Boeing's financial metrics show a P/E ratio of -29.75 and a negative revenue growth of 0.07% over the last twelve months as of Q2 2024. Despite the stabilization in aircraft deliveries, the company's gross profit margin stands at 10.46%, highlighting the challenges mentioned in the InvestingPro Tip that Boeing suffers from weak gross profit margins.

InvestingPro Tips also indicate that Boeing's stock price is trading near its 52-week low, and analysts do not anticipate the company will be profitable this year. This aligns with the forecast that the aerospace giant may have trouble making interest payments on its debt. For investors considering Boeing's stock, it is worth noting that the company is a prominent player in the Aerospace & Defense industry, as reflected in its recent $10 billion Apache helicopter deal with Poland. However, with 18 analysts having revised their earnings downwards for the upcoming period, caution is advised.

To gain a more comprehensive understanding of Boeing's financial outlook and potential investment strategies, there are additional InvestingPro Tips available at https://www.investing.com/pro/BA. These tips could provide further insights into Boeing's performance and what investors might expect in the near future.

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