Bank of America Recommends Buying Tumbling Shares of Aviation Giant Amid Production Delays
Boeing (BA) shares fell this week after CEO Kelly Ortberg highlighted production challenges with the 737 and 787 models at Morgan Stanley's Laguna Conference. The stock closed at $198.20 on September 18, down nearly 5% over five days and more than 12% year to date. Ortberg noted that Boeing has not yet stabilized its production rate for the 737 model and pushed back certification testing of the 777X into 2027 due to engine seal issues. Despite these setbacks, Bank of America analyst Ronald Epstein reiterated a Buy rating with a $270 price target. He argued that Boeing's turnaround is expected to be non-linear given its complex operations and regulatory environment. Epstein also emphasized the importance of an upcoming labor contract negotiation involving 17,000 engineers represented by SPEEA, which could impact production timelines. Epstein believes the recent selloff overreacted to Ortberg’s comments and sees value in buying shares at a discount.
Topics: analyst recommendation Boeing production delays share price decline