Aerospace stock Boeing (BA) has a wonderfully diversified product line. Between its commercial aircraft and its military functions, it seems to always have something to sell somewhere. And Boeing proved as much recently with a $500 million sale to Israel for a pair of KC-46 aerial refueling tankers. The deal did oddly little for investors, though, who sent shares down fractionally in Wednesday afternoon’s trading.
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The Israeli defense ministry noted that it was planning to pick up the two flying tankers with the support of the United States, which gave them the military aid money necessary to purchase the aircraft to begin with. Once a ministerial committee approves the deal, it will then sign the necessary purchase orders.
Israel actually has four KC-46 tankers in its stable already, so the deal will bring it up to six. The move will also provide—according to Director General Amir Baram—extra help in “long-range strategic capabilities,” complete with the ability to use greater force and address more types of missions. The aerial refuel tankers actually proved very valuable during the 12-day war against Iran back in June.
A Boost From Airbus
Just days ago, we found that Boeing’s immediate rival Airbus (EADSY) was poised to eat Boeing’s lunch and take a spot that Boeing had held for decades. However, Boeing may have just bought an opportunity to gain some lead back with a new move at Airbus. Airbus, it seems, is having some labor trouble of its own, with a strike set to hit in September.
Reports note that thousands of Airbus’ employees in the United Kingdom will be on strike for 10 days in September as a contract dispute is forming. The employees in question build the wings for Airbus planes, which will likely mean production will at least be slowed down. Airbus, however, does not look for the short strike to impact its slate of full-year deliveries. Thus, any advantage Boeing might get here will likely be short-lived.
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 18 Buys and two Holds assigned in the past three months, as indicated by the graphic below. After a 29.74% rally in its share price over the past year, the average BA price target of $258.17 per share implies 14.78% upside potential.
