Boeing Stock Selloff Creates Attractive Entry Price Amid Execution-Driven Recovery
Boeing's stock selloff has created an attractive entry price for investors, but experts warn that the company's recovery is still execution-driven rather than a repaired business.
The stock closed at $187.68 on September 29th, down 10.55% over one month and 13.97% year to date. In pre-market trading on September 30th, it was $193.84, up 3.28%. Despite the volatility, some analysts believe that deliveries and production are improving, with 60 May deliveries including 51 737 MAX aircraft supporting management's longer-term free-cash-flow recovery thesis.
Citi analysts stated that recent events have forced a steepening in the upcoming FCF ramp, but their bullish view remains intact. They expect differentiation to occur later this decade, specifically in 2029 and 2030. Additionally, Fitch has moved the credit outlook for Boeing to Positive, citing steadier 737 MAX production and debt reduction.
However, some concerns remain, particularly with regards to the balance sheet. Debt-to-equity was 793.6% as of June 30th, while levered free cash flow was negative $210M during the same period. The latest FinQL fair-value model showed a 14.7% downside as of September 30th.
Technical signals remain bearish, with a Strong Sell on both daily and weekly timeframes. A sustained move above $195.82 would improve the near-term technical picture, while a break below $178.30 would suggest that the selloff still has room to run.