Shares of Boeing rose 6.8% on Friday as the US Federal Aviation Administration (FAA) Chief is about to pilot the 737 MAX on a test flight this week, Reuters reported. The move is seen as an important milestone to get the troubled aircraft airborne again.
According to the Reuters report, the FAA has informed US lawmakers that the agency’s Chief Administrator Steve Dickson and Deputy Administrator Dan Elwell “will be in Seattle next week to take the recommended training.” Notably, Dickson had previously said that he would not give approval until he flew the MAX aircraft himself. (See BA stock analysis on TipRanks).
Boeing’s (BA) 737 MAX planes have been grounded worldwide since mid-March 2019 following two fatal crashes within six months, which took 346 lives. Boeing needs regulatory approvals for the changes it has made to address the flaws that caused the accidents.
On Sept. 20, Goldman Sachs analyst Noah Poponak added the stock to his “Conviction List” and reiterated a Buy rating on the stock with a price target of $225 (44.2% upside potential). Poponak believes that despite the current challenging aircraft demand and supply environment, Boeing’s order backlog is “still robust.”
Currently, the rest of the Street is cautiously optimistic on the stock. The Moderate Buy analyst consensus is based on 7 Buys, 8 Holds, and 1 Sell. With shares down over 52% year-to-date, the average analyst price target of $193 implies upside potential of 23.7% from current levels.