Summary: OVERPRICED
Score: 4/20
MOS: 0%
Share Price: $172
Sticker Price: $0.00
Boeing has been going through a rough stretch. Most of us know about the Lion Air 737 MAX that crashed in 2018, due to an electronic issue. Since that event, circumstances have not improved.
Today, CEO Dave Calhoun announced the company had a $2.4B quarterly loss and an overall 65% revenue drop over the last year. Not good.
Boeing has been one of the largest stocks in the world for decades. It’s listed on the Dow Jones Industrial Average which is the TOP 30 largest companies in the US. Some of the other DOW companies include Microsoft, McDonald’s, Visa, and Wal-Mart. Just because you make the top 30, doesn’t mean you’re going to stay there. HP was booted from the DOW in 2013 and replaced by Visa. AT&T was booted from the DOW in 2015 and replaced by Apple. GE was booted from the DOW in 2018 and replaced by Walgreens. Boeing may be next in line.
When we look at both the airplane manufacturing industry as well as the airline industry (Southwest, Alaska Air, and American Airlines), there are concerns. We’ve entered a new state of work because a lot of companies are now allowing employees to work remote. This means work travel will not be as prominent. Less work travel equates to less revenue for airlines and less demand from airplane manufacturers.
Boeing resides on a lot of mutual funds and index funds. It’s been a staple for decades but now it may be holding your portfolio down if you still own it.
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.