This is a step-by-step stock review to answer the question, is Boeing (BA) stock a good buy?
This article will teach you how to use the 4Ms of investing. This will be a detailed walkthrough to show you how the 4Ms work and why they are important. If you are interested, you can log into Tykr to use the 4M Confidence Booster (Powered by OpenAI) which will allow you to complete a 4M Analysis in less than 60 seconds.
What are the 4Ms?
- MOS (Margin of Safety) – The MOS is the math part of investing which includes the Summary, Score, and MOS (Margin of Safety).
- Meaning – The meaning is the business model and how scalable the revenue streams are.
- Moat – The moat is how the business compares to other companies in the same Sector and Industry.
- Management – The management is the track record of the CEO.
What 4M score are we going for?
- 80-100 = High confidence – Yay! You should have high confidence buying this stock. It passes all 4M!
- 60-79 = Moderate confidence – Alert! There may be better stocks in the market. Only buy this stock if you truly believe the company will improve!
- 0-59 = Low confidence – Warning! There are better stocks in the market. Due to the low score, you should consider looking at other stocks.
Table of Contents
The following links will direct you to key topics to help answer the question, is Boeing (BA) stock a good buy?
1.Boeing (BA) Company History
- Founded in 1916: Boeing was established by William Boeing in Seattle, Washington, initially focusing on building seaplanes.
- Pioneering Aviation: During World War I, Boeing became a key supplier of military aircraft, laying the groundwork for its future dominance.
- Commercial Aviation Leader: In the 1930s, Boeing introduced the Model 247, one of the first modern airliners, revolutionizing commercial air travel.
- World War II Production: Boeing was crucial in World War II, producing iconic bombers like the B-17 and B-29, solidifying its status as a defense contractor.
- Jet Age Innovator: In 1958, Boeing launched the 707, the first successful commercial jetliner, ushering in the Jet Age and transforming global travel.
- Space Exploration: Boeing played a pivotal role in the Apollo moon missions and continues to be a major player in space exploration and satellite technology.
- Mergers and Acquisitions: Boeing merged with McDonnell Douglas in 1997, expanding its defense and aerospace capabilities.
- Global Aerospace Giant: Today, Boeing is a leading aerospace company, known for its commercial airplanes, defense systems, and space exploration efforts, headquartered in Chicago, Illinois.
- Commercial Airplanes: Boeing sells airplanes to airlines and leasing companies around the world. These include popular models like the 737, 777, and 787.
- Defense Contracts: Boeing provides military aircraft, helicopters, missiles, and defense systems to governments, especially the U.S. government.
- Space Exploration: Boeing earns money by building rockets, satellites, and other space technology for NASA and other space agencies.
- Services and Maintenance: Boeing offers maintenance, repair, and support services for airplanes and defense systems, ensuring they operate safely and efficiently.
- Research and Development: Boeing invests in new technologies and sometimes partners with other companies, generating revenue through innovation and collaboration.
- Global Services: Boeing provides training, digital solutions, and logistics services to airlines and defense customers worldwide.
2. MOS (Margin Of Safety)
When investing in a company, the first step is to look at the financials. Fortunately, Tykr does this for us automatically. The higher the score, the stronger the financials and the safer the investment. The higher the MOS, the higher the potential returns you can make.
- Summary: Overpriced
- Score: 45
- MOS: 1%
To see the most up-to-date Summary, Score, and MOS, please log into Tykr.
3. Meaning
When investing in a company, it’s important to know how a company makes money. A mature business model has multiple streams of revenue which allow the company to weather downturns in the economy.
Here is how Boeing makes money:
- Commercial Airplanes: Boeing sells airplanes to airlines and leasing companies around the world. These include popular models like the 737, 777, and 787.
- Defense Contracts: Boeing provides military aircraft, helicopters, missiles, and defense systems to governments, especially the U.S. government.
- Space Exploration: Boeing earns money by building rockets, satellites, and other space technology for NASA and other space agencies.
- Services and Maintenance: Boeing offers maintenance, repair, and support services for airplanes and defense systems, ensuring they operate safely and efficiently.
- Research and Development: Boeing invests in new technologies and sometimes partners with other companies, generating revenue through innovation and collaboration.
- Global Services: Boeing provides training, digital solutions, and logistics services to airlines and defense customers worldwide.
Here are a few of the other companies that Boeing has acquired over the years. This is important because a company will use a “Buy before build” philosophy to go to market faster and add additional streams of revenue. A company with more revenue streams has a more stable business model. Keep in mind, that most companies don’t build new software because it takes too long to go to market and generate revenue.
- McDonnell Douglas
- Rockwell International’s aerospace and defense units
- Hughes Space and Communications
- Aviall Inc.
- Vought Aircraft Industries’ South Carolina facility.
4. Moat
When investing in a company, it’s important to understand how a company ranks against other companies in the same sector and industry. Based on the Score, here is how Boeing stacks up against other companies.
- TransDigm Group Incorporated.(TDG) – 89
- BWX Technologies, Inc.(BWXT) – 83
- Cadre Holdings, Inc.(CDRE) – 78
- General Dynamics Corporation. (GD) – 72
- Curtiss-Wright Corporation.(CW) – 72
- The Boeing Company.(BA) – 45
To see the most up-to-date Summary, Score, and MOS and each stock, please log into Tykr.
5. Management
When investing in a company, it’s important to understand who the CEO is, what they have accomplished in the past, and how they have helped this company grow. Good leaders typically have stronger cultures, less turnover, and better returns in the stock market.
- Strengthened Defense Portfolio: Kelly Ortberg played a key role in expanding Boeing’s defense business, securing major contracts and enhancing the company’s position in the defense sector.
- Successful Integration of Rockwell Collins: Under his leadership, Boeing successfully integrated Rockwell Collins, which was a major acquisition aimed at expanding its avionics and communications capabilities.
- Increased Focus on Innovation: Ortberg emphasized innovation and technology development, contributing to advancements in Boeing’s product offerings, including new aircraft models and systems.
- Operational Improvements: He led efforts to streamline operations and improve efficiency, resulting in cost savings and enhanced productivity across Boeing’s divisions.
- Enhanced Customer Relations: Ortberg strengthened relationships with key customers, including governments and airlines, ensuring continued business and growth opportunities for Boeing.
- Global Market Expansion: His leadership helped Boeing expand its market presence internationally, increasing its global footprint and competitive edge.
6. 4M Score
All of our homework on this company leads up to the 4M Score. A lot of investors only look at the numbers. Yes, it’s important to look at the first M (MOS) which is the math part of investing but it’s also important to look past the numbers and also look at the Meaning, Moat, and Management. If all 4Ms pass, we should have high confidence in buying this stock.
What 4M score are we going for?
- 80-100 = High confidence – Yay! You should have high confidence buying this stock. It passes all 4M!
- 60-79 = Moderate confidence – Alert! There may be better stocks in the market. Only buy this stock if you truly believe the company will improve!
- 0-59 = Low confidence – Warning! There are better stocks in the market. Due to the low score, you should consider looking at other stocks.
👉 The 4M Score of Boeing (BA) is 50/100.
To see the most up-to-date 4M Score, please log into Tykr.
7. Is Boeing (BA) stock a good buy?
Some of the top questions investors can have is Boeing (BA) stock a good buy or should I buy Boeing (BA) stock?
Boeing (BA) presents a mixed investment opportunity. As a leading aerospace and defense company, Boeing benefits from a strong market position and extensive product portfolio, including commercial airplanes, defense systems, and space technology. The company has a history of innovation and successful contracts, contributing to steady revenue streams and global market presence.
However, Boeing has faced significant challenges, including production delays, safety issues with the 737 MAX, and financial strain from the COVID-19 pandemic. These factors have impacted its stock performance and market reputation. Despite recent improvements and strategic measures, such as new aircraft models and cost-cutting initiatives, the company’s recovery trajectory remains uncertain.
Investors should weigh Boeing’s strong industry position and growth potential against its recent operational and financial challenges. Careful consideration of these factors is essential for evaluating its investment potential.
With score of 4/20, the financials are not looking good. With a share price of $172 and a sticker price of $0.00, don’t expect this stock to rise anytime soon.