Investing in the stock market requires a keen eye on market trends, company performance, and investor sentiment. Boeing, a giant in the aerospace industry, has been a topic of debate among investors, especially considering its challenges and market position in 2024. Let’s delve into the different perspectives on Boeing as an investment, based on recent analyst ratings, investor discussions, and market data.

 

Analyst Ratings: A Mixed Bag

 

Boeing’s stock has seen varied ratings from financial analysts. While some have downgraded their recommendations, moving from “Buy” to more neutral stances, others maintain a “Buy” rating, albeit with adjusted target prices. This mix of opinions points to an uncertain future for Boeing, reflecting the complex factors influencing the company’s trajectory??.

Despite analysts being cautious or slightly bearish, the financial expectations appear to be positive. After 2018 crash of earnings and cash flow due to Max 737 disastrous scandal investors are now expecting the earnings to go up again by 169%.

 

 

Problems are piling up

 

When it all looked rosy again and Boeing seemed to be finally done with all the problems new disaster turned up when a part of the plane – a fuselage panel – blew out of an Alaska Airlines (AAL) on January 5th after which the FAA grounded the plane. The stock fell by 8.75% that day.

As an investor I am asking a question, will Boeing survive a barrage of problems and recover? Is Boeing investable? As a trader (even when trading a crumbs strategy) I couldn’t be happy seeing a stock tumble by almost 10% in a single day due to a scandal and engineering mishaps.
 

Investor Sentiment: Cautiously Optimistic or Critically Concerned?

 

In investor forums and discussions, Boeing’s future prospects have sparked a lively debate. A segment of investors displays confidence in Boeing’s recovery, citing its potential once the FAA lifts restrictions on its planes. In contrast, others are critical of Boeing’s management decisions and financial health, expressing concerns over the company’s long-term profitability and viability.

However, looking at the financials we can see that the company’s free cash flow started picking up in 2022 (by 151%) and in 2023 (by 42%). Analysts expect this trend to continue:

 

 

But these expectations may change if the problems keep coming and more of the Boeing planes continue falling apart or blatantly of the skies. The cash flow may quickly die off and the entire company can go into bankruptcy despite it being a behemoth with many government military contracts (a possible spinoff of the civilian aviation section from the military government protected segment of the company).
 

Short Interest: Reading Between the Lines

 

The short interest ratio, a measure of stock shorted compared to the average daily volume, stands at 2.0 for Boeing. Generally, a ratio between 1 and 4 indicates positive sentiment and fewer short sellers. However, this figure has fluctuated, suggesting changing investor attitudes toward the company over time.
 

Pros and Cons: Weighing Boeing’s Future

 

Pros: Boeing boasts strengths like its leading position in manufacturing commercial jetliners and military aircraft, a history of innovation, and a diverse product portfolio. These factors position Boeing favorably in the aerospace industry.

Cons: The company faces challenges like the cyclical nature of the aerospace industry, intense competition, regulatory risks, and recent issues impacting its financial performance and reputation.
 

Is Boeing Investable at the Current Situation?

 

I personally would be cautious investing in this company that has not been able to solve their problems since 2018. Even if all starts looking good, where is the assurance that they do not blow something else off? Are their problems finally over? I have no clue obviously but also no assurance from the current management that Boeing is a good investment. Although I admit, flying with Max was a pleasureful experience and I didn’t feel like falling from the sky would happen during the flight, I can’t say the same about investing in Boeing.

 

 

Conclusion

 

Boeing, as an investment in 2024, presents a complex picture. The varied analyst ratings, diverse investor sentiments, and the company’s own mix of strengths and challenges make it a nuanced choice for investors. Those considering Boeing should seek personalized advice from financial advisors, considering the latest market trends and their own investment strategies.

In the ever-changing landscape of the stock market, Boeing exemplifies the need for thorough research and a balanced approach to investment decisions. Whether it emerges stronger or continues to face hurdles will be a story to watch in the coming years.

I would wait for the company to show a better commitment and improvement before committing cash. A pure resolution of the FAA investigation and release of Max 737 back to service is not an incentive for me to invest in this company. I would like to see a bit more than that.