For a while there, things looked like they were starting to turn around for aerospace stock Boeing (BA) in St. Louis, as negotiators, backed up by federal mediators, came back to the table. Boeing offered up another contract, and it fell flat once more as the union turned it down. Yet investors saw hope, and sent shares up fractionally in Monday afternoon’s trading.
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The strike has been on for the last 13 weeks now, reports note, and the latest contract failed to “…address the needs of…” the workers in the International Association of Machinists and Aerospace Workers District 837. IAM International president Bryan Bryant noted, “Boeing claimed they listened to their employees – the result of today’s vote proves they have not. Boeing’s corporate executives continue to insult the very people who build the world’s most advanced military aircraft—the same planes and military systems that keep our servicemembers and nation safe.”
Reports noted that the offer Boeing sent out was largely unchanged from preceding offers, which is in keeping with Boeing’s stance that it is already making the best offer it can. Boeing has previously called its deal “…market-leading,” a point that seems to be cutting little ice with Boeing staff. With Boeing’s third-quarter results set to arrive on Wednesday, the recent tales of mounting sales will likely be at least somewhat tainted by this news.
Brace for a Long Wait
Meanwhile, reports emerged noting that Boeing is working on developing a new plane to replace the 737 MAX, a point we have known for some time. However, it is clear that the process is likely to take longer than expected, as Boeing looks for the new plane to come out in 2040.
This could be a larger problem than some expect, reports note, as Airbus (EADSY) expects to have a replacement for the A320neo in roughly 2038. If that is the case, then Boeing may be caught on the back foot once more. However, some reports suggest that the underlying technology for the neo’s replacement will not be available until, roughly, the 2040s, which may put Airbus behind Boeing in the end.
Is Boeing a Good Stock to Buy Right Now?
Turning to Wall Street, analysts have a Strong Buy consensus rating on BA stock based on 13 Buys and one Hold assigned in the past three months, as indicated by the graphic below. After a 46.89% rally in its share price over the past year, the average BA price target of $258.91 per share implies 16.43% upside potential.
