Breaking News
Investing Pro 0
🚨 Our Pro Data Reveals the True Winner of Earnings Season Access Data

The worst is behind Boeing - Morgan Stanley

Stock Markets Nov 29, 2022 17:08
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters.
 
BA
-0.59%
Add to/Remove from a Portfolio
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 

By Sam Boughedda

Morgan Stanley analysts said in a note on Monday that the firm is positive on the outlook for aircraft demand and Boeing (NYSE:BA) deliveries.

The analysts reiterated an Overweight rating and $213 per share price target on Boeing.

"YTD Boeing's stock is down ~15% compared to the S&P 500 of down ~17%, modestly outperforming after the stock's recent rally to ~$172. This marks a strong turnaround from June when the stock was down ~42.5% YTD and trading at ~$116 while the S&P 500 was down ~24%. With the stock's rally of up ~48% from its trough vs. the S&P 500 of up ~8%, we've been receiving a lot of investor questions regarding whether this is the time to buy Boeing, if the trade is over, and what the bull and bear cases are at these levels," wrote the analysts.

They added that it is clear to Morgan Stanley that even though Boeing "has a lot of work to do" in areas such as stabilizing the supply chain, delivering aircraft from inventory, preparing for the next rate break in BCA, "the worst is behind the company."

"After $28bn of free cash flow usage from 2019-2021, the company is now entering a period of positive free cash flow. With Aerospace still a duopoly, supply of aircraft is scarce, supporting Boeing's backlog. We see the benefits that come from steady and increasing aircraft production rates outweighing the risks associated with recent execution missteps in Defense," the analysts added.

The analysts went on to state that the current key debates for Boeing right now are what production rates can the supply chain support, what is normalized earnings and free cash flow for Defense, how strong is the demand for new aircraft, what is the future of the 737 MAX in China, and what is the certification path for the 737 MAX 7 and 10.

Boeing shares are up 1.6% at the time of writing on Tuesday.

The worst is behind Boeing - Morgan Stanley
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email