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Arlington, Virginia-based The Boeing Company (BA) designs, develops, manufactures, sells, and services commercial jetliners, military aircraft, satellites, missile defense, human space flight, and launch systems. With a market cap of $95.9 billion, Boeing’s operations span the Americas, Indo-Pacific, Europe, and internationally.
The aerospace & defense giant has substantially underperformed the broader market over the past year. Boeing’s stock prices have plummeted 40.5% in 2024 and 20.5% over the past 52-week period compared to the S&P 500 Index’s ($SPX) surge of 19.8% on a YTD basis and 31.1% over the past year.
Narrowing the focus, Boeing has also underperformed the SPDR S&P Aerospace & Defense ETF’s (XAR) 14.7% gains on a YTD basis and 28.2% returns over the past year.
In a series of alarming incidents, Boeing’s passenger aircraft have faced technical malfunctions, leading to tragic accidents. In July, Boeing admitted to defrauding the Federal Aviation Administration, severely tarnishing its reputation. Adding to its woes, both Moody's Corporation (MCO) and S&P Global Inc. (SPGI) had downgraded Boeing’s bonds, which will lead to higher finance costs for the company. These events have led to a massive wipe-off in shareholders' wealth and trust in the company.
Shares of Boeing dropped 1.8% and maintained a negative momentum for the next three trading sessions after the release of its Q3 earnings on Oct. 23. Boeing’s financials were adversely impacted due to the International Association of Machinists and Aerospace Workers (IAM) work stoppage and charges on commercial and defense programs. It reported a 1.5% year-over-year drop in revenues to $17.8 billion. While its non-GAAP net loss per share grew from $3.26 in the year-ago quarter to $10.44, it missed Wall Street’s estimates.
For the current fiscal year, ending in December, analysts expect Boeing to report a adjusted net loss of $16.09 per share, down 176.9% from a loss of $5.81 per share reported in the previous year. The company’s earnings surprise history is mixed. It has missed Wall Street’s earnings estimates twice over the past four quarters while missing on two other occasions.
BA stock has a consensus “Moderate Buy” rating overall. Among the 24 analysts covering the stock, 14 recommend a “Strong Buy,” one advises a “Moderate Buy,” seven suggest a “Hold,” and two give a “Strong Sell” rating.
This configuration is slightly less bullish than a month ago when 16 analysts recommended a “Strong Buy.”
On Nov. 4, Wells Fargo & Company (WFC) analyst Matthew Akers maintained a “Sell” rating and lowered the price target to $85.
The mean price target of $189.50 represents a premium of 22.2% to current price levels. Meanwhile, the street-high target of $250 suggests a potential upside of 61.2%.
On the date of publication, Aditya Sarawgi did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
