Lou Whiteman has no position in any of the stocks mentioned. Why should you be worried about recession? Airbus Soars Past Boeing at the Paris Air Show, Why It Makes No Sense to Invest in the Airline Industry (and Why Boeing and General Electric Investors Will Do It Anyway), 3 Changes to Social Security You Probably Didn't Know, 4 Unequaled Growth Stocks You'll Regret Not Buying in the Wake of the Nasdaq Bear Market Dip, 2 Top Artificial Intelligence Stocks to Buy in July, Join Over Half a Million Premium Members And Get More In-Depth Stock Guidance and Research, Copyright, Trademark and Patent Information. What are analysts forecasts for Boeing stock? Boeing posted a first-quarter loss of $2.75 per share on revenue of $14 billion, falling short of analysts' consensus expectations for a $0.12 per share loss on revenue of $15.83 billion. Why did boeing stock drop in 2020 - hltf.teatrodiricerca.it Why Boeing Stock Is Falling Today | The Motley Fool Youre reading a free article with opinions that may differ from The Motley Fools Premium Investing Services. Invest better with The Motley Fool. Last years upsloping yield curve (from left to right, short to long duration) is typical of the early to middle stages of an economic cycle, where its easier for banks to earn a profit by borrowing money from savers at far lower cost than the long-term loan rates received through new loan originations or investments in the financial system. Part 2. Volatility profiles based on trailing-three-year calculations of the standard deviation of service investment returns. Analysts Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Short position through short-selling of the stock, or purchase of put options or similar derivatives in BA over the next 72 hours. All opinions expressed herein are not investment recommendations, and are not meant to be relied upon in investment decisions. Youre reading a free article with opinions that may differ from The Motley Fools Premium Investing Services. "Bottom Fishing Club" articles focus on deep-value candidates or stocks experiencing a major reversal in technical momentum to the upside. Youre reading a free article with opinions that may differ from The Motley Fools Premium Investing Services. Consider this: With Boeing stock down 40% over the past year, any new shares Boeing issued and sold today would bring in far . Even after the sell-off, I'd avoid buying Boeing shares. You'd think investors would consider this good news for Boeing stock. Of course, thats the present Wall Street forecast for 2023-24 decent growth. BA is not trading on fundamentals. Key Points CEO Dave Calhoun announced the production cuts after the company released a $2.4 billion quarterly loss. Past performance is no guarantee of future returns. The pandemic is causing investors to rethink Boeing's long-term sales projections. Investors responded by hitting the "eject" button, sending Boeing shares down as much as 9% in morning trading. To boot, total liabilities as a ratio of assets (including intangibles of $10 billion) have steadily doubled from 0.55 in 1998 to 1.12 today. Making the world smarter, happier, and richer. Is Boeing Stock A Sell? While their debt is clearly substantial, the biggest difference between now and previous recessions is Boeings production backlog. StockCharts.com - Boeing, 18 Months of Daily Price and Volume Changes. Below are charts of the yield curve from 1-month to 30-years for the current setup and December 2021. Boeing Is The Most Vulnerable to Coronavirus. Boeing's stock took a beating Tuesday amid reports that its Max 737 could remain grounded for months longer than initially expected. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services. That said, fair value is closer to $100 according to my valuation. Enterprise value ratios (using equity capitalization + debt cash) are already flashing the stock valuation is excessive, unless a big jump higher in earnings and sales is in the offing. The MAX grounding is likely to cost Boeing billions of dollars, and the total is still growing. Invest better with The Motley Fool. Excess M2 has to shrink. I have no business relationship with any company whose stock is mentioned in this article. Boeing (BA) Q2 2020 reports earnings, warns of new job cuts - CNBC By Al Root Updated Oct. 14, 2021 3:40 pm ET / Original Oct. 14, 2021 8:27 am ET Order Reprints Print Article Boeing has another quality problem. Mr. Franke was Director of Research at Quantemonics Investing from 2010-13, running several model portfolios on the Covestor.com mirror platform (including the least volatile, lowest beta, fully-invested equity portfolio on the site). Boeing (NYSE: NYSE: BA) on Wednesday fell 8.8% -- the stock's biggest one-day decline since May -- after the aircraft maker lost more money in Q3 than Wall Street had expected. Boeing's Q4 2020 Results And 2021 Outlook Signal Inevitable Pullback I wrote this article myself, and it expresses my own opinions. But as Reuters now reports, after reviewing bids from the defense contractors, Canada has concluded that the F/A-18 does not, in fact, meet Canada's requirements, and Boeing is out of the running. *Average returns of all recommendations since inception. Boeing Co. stock outperforms market despite losses on the day Boeing Stock Crashes to 52-Week Low Following Shocking Report on 737 Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Learn More. Discounted offers are only available to new members. Mr. Franke was Editor and Publisher of the Maverick Investor newsletter during the 1990s, widely quoted by CNBC, Barrons, the Washington Post and Investors Business Daily. YCharts - Boeing vs. S&P 500 Total Returns, Recession Shaded, June 2019 to December 2020, YCharts - Boeing vs. S&P 500 Total Returns, Recession Shaded, July 2007 to December 2009, YCharts - Boeing vs. S&P 500 Total Returns, Recession Shaded, October 2000 to March 2003, YCharts - Boeing vs. S&P 500 Total Returns, Recession Shaded, March 1990 to March 1993. Why Boeing Stock Dropped Today | The Motley Fool Typically during recessionary periods, passenger airline traffic and demand for new planes plummets, leading to horrible operating performance for the company. Shares of Boeing Co. (BA -0.24%) fell 13.6% in February, according to data provided by S&P Global Market Intelligence. Boeing 737 Max can fly again: Key level to watch in the stock Boeing's efforts to rebuild its business following the 737 MAX grounding and the pandemic remain sluggish, with the company losing significantly more than expected in the first quarter. There are three main reasons why Boeing stock has rallied recently. It's not a crippling blow for the company, but this still represents a good chunk of the roughly $26 billion in annual sales Boeing generates from defense, space, and security, according to data from S&P Global Market Intelligence. Boeing stock was grounded long before the rest of the airline industry based on controversy related to the 737 Max. "2020 was a historically challenging year for our world, for our industry (and) for our business," Calhoun said.The $11.9 billion dollar net loss is the largest in the aerospace giant's more than 100-year history and a big part of the reason is the coronavirus pandemic. The Motley Fool has a disclosure policy. Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. But heard a different way, West's comments struck a more downbeat note. You can email the site owner to let them know you were blocked. The company doesn't expects the 737 MAX to ramp up to more than 30 airframes per month until . Down some 68% already through the first four weeks of. The aerospace giant delivered 18 more planes in Q1 than it did in the prior-year period, and said 737 MAX production and deliveries continue to increase. Weakest Boeing Financials Going Into Recession: $100 Price Target #2, because Boeing has a history of truly rotten investor performance during recession. The Motley Fool has no position in any of the stocks mentioned. The short sale of securities in overvalued, weak momentum stocks as pair trades and hedges is also a part of the Victory Formation long/short portfolio design. And Calhoun doesn't expect demand to bounce back any time soon. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. I am not receiving compensation for it (other than from Seeking Alpha). First, Barron's reports today that S&P Ratings just downgraded Boeing's credit rating two notches to "BBB" -- letters that don't mean much to most investors, but that tell lenders that Boeing debt is now just a couple points away from being turned into junk bonds. Please. ( BA) - Get Free Report are down -1. b*0)da-4 A$- P*''0/$*) $) /he z. Shares of Boeing (BA -0.24%) fell out of bed Friday, dropping 6.5% by 9:40 a.m. That should help the company, which bled through more than $15 billion in the first nine months of 2020, to stem losses and increase the cash coming in. Air travel demand plummeted amid global travel restrictions and fears of spreading the virus, and Calhoun notes that the number of people flying today is still down nearly 60% from a year ago at this time. But Boeing remains a troubled company with a reputation in need of repair and uncertain demand over the next 18 months for its key products. In the end, credit standards (creditworthiness from borrowers) are raised to prevent loan losses in the future, and originators may decide not to make riskier-loans, even ones approved last year. In fact, as recently as this morning, Boeing stock actually seemed like it was heading higher, posting 4.5% gains in early trading, after Boeing CFO Brian West visited Goldman Sachs to announce that China will soon clear the Boeing 737 MAX airliner for a return to service in that country. But perhaps the scariest news of all for Boeing stakeholders is company financials are the least healthy in decades. Instead, Boeing's down on two news items specific to it. The 53 analysts offering price forecasts for Boeing have a median target of 221.53, with a high estimate of 290.00 and a low estimate of 98.00. This article is not an investment research report, but an opinion written at a point in time. I don't think the recession comparisons are equal to current day's situation. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. The company is basically tracking the S&P 500 during calendar 2022 and is down a relative -24% to this blue-chip index since May 2021, with Negative Volume Index and On Balance Volume patterns not very supportive of future price gains. Lou Whiteman has no position in any of the stocks mentioned. I like your article. Boeing Stock: Under $100, Boeing's a Nice Long-Term Buy | InvestorPlace Thanks for reading. The Dow Jones Industrial Average bounced more than 150 points on Monday, but the index's most heavily weighted stock, Boeing, failed to receive an invitation to the party. Boeing has cut its forecast for airplane demand due to COVID-19, with a rebound not expected until the second half of the 20-year forecast period. Boeing Stock: Is It A Buy As The 737 Max Reportedly Takes Flight In Cost basis and return based on previous market day close. My concern is a recession could easily cause operating losses for several more years, and encourage investors to sell shares back to a recession valuation level. Why Shares of Boeing Lost Nearly Half Their Value in March are being fixed, and total sales will zigzag in the right direction following the COVID-19 pandemic-related decimation in new plane demand. *Average returns of all recommendations since inception. Bjorns Corner: Why e in ePlane shall stand for environment, Part 13. Q: "Philosophically speaking is a business worth owning if it lacks these three value-creating characteristics?". Volatility profiles based on trailing-three-year calculations of the standard deviation of service investment returns. The quarter included more than $200 million in one-time charges related to lost business due to sanctions on Russia and more than $1 billion in charges due to delays in its T-7A Air Force trainer plane and the new Air Force One. I wrote this article myself, and it expresses my own opinions. Airlines have reacted to plummeting demand for travel by cutting flights and grounding planes, and even if demand returns when the pandemic is contained, the U.S. economy might by then be in a recession. By accessing this page, you agree to the following Making the world smarter, happier, and richer. 1. At this writing, Boeing is down 13.5% at $163. Still, I'd advise investors to remain on the sidelines until there is more clarity about when the 737 MAX will fly again and how it, and Boeing, will be perceived by customers once it's back in service.