Boeing Stock Stagnant Despite Record Deliveries and Revenue Growth

Boeing's stock has been stagnant for three years despite significant growth in deliveries and revenue. Since September 2023, the company's share price has returned only 0.6%, a paltry 0.2% annualized rate that leaves it roughly where it was three years ago at $211.

The discrepancy between rising deliveries and flat program economics can be attributed to legacy contracts signed during Boeing's weakest years, which continue to weigh on cash generation for each new jet. Additionally, the company booked a $280 million charge on the VC-25B Air Force One program in the quarter due to engineering costs.

A potential catalyst for change is the Pentagon's decision on the F/A-XX stealth fighter contract, which could be announced within weeks and is worth tens of billions of dollars. A win would hand Boeing's defense unit a multi-decade production program as its margins recover from years of fixed-price losses.