After the last few days, it is good to get some good news on the docket for aerospace stock Boeing (BA). Lost orders, legal backlash…things were not looking bright. But Boeing turned it around with reports that the Chinese market would start taking deliveries of Boeing aircraft soon. That gave shares a healthy boost, sending prices up around 2.5% in Thursday afternoon’s trading.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
Boeing CEO Kelly Ortberg noted that, starting next month, Chinese airlines would once again start taking deliveries of Boeing aircraft. This is especially good news for Boeing, because it pays tariffs on parts coming in from places like Japan and Italy to put the planes together, so being able to sell them again allows Boeing to recoup the costs spent in getting the parts in to begin with.
And things are looking up, at least as far as Ortberg is concerned. Ortberg looks for Boeing to really gear up production on its 737 Max jet, up to the limits the Federal Aviation Administration (FAA) has put on production. And, potentially, beyond; Ortberg still looks to get back up to, ultimately, 47 such jets per month. Further, Ortberg also does not look for the tariffs to stay in place forever; while a court case has already knocked some of them out of place for now, Ortberg looks for none of these tariffs to be “…permanent in the long term.”
Easier Inspections, Anyway
Further, Boeing got a bit of a boost as the FAA noted that it would add an extra three years to the Organization Designation Authorization (ODA) plan that allowed Boeing to handle some of its own inspection-related duties. Boeing had, reportedly, made sufficient improvement to its own processes to allow that program to stand.
A series of programs followed, as Congress passed reforms on airworthiness certifications, and the FAA continues to inspect Boeing aircraft to ensure that airworthy condition. But some tasks could—and are—being safely delegated to Boeing itself, whose ODA employees operate without interference from the company itself.
Is Boeing a Good Stock to Buy Right Now?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on BA stock based on 15 Buys, four Holds and one Sell assigned in the past three months, as indicated by the graphic below. After a 16.64% rally in its share price over the past year, the average BA price target of $213.37 per share implies 3.7% upside potential.
