Boeing Company (NYSE:BA) shares are trading higher on Monday after Bernstein upgraded the stock from a Market Perform rating to a Outperform rating and raised its price target from $181 to $218.
What To Know: In the note, analyst Douglas Harned said “all looked good” with Boeing until the Alaska Airlines door accident in January 2024, but the company is now making progress on its prior growth trajectory.
The analyst expects Boeing is on track to produce 38 737 MAX planes per month by July, in line with CEO Kelly Ortberg‘s comments during the company's latest earnings call. Ortberg said the company might start producing 42 737 MAX planes per month by the end of the year, if the Federal Aviation Administration signs off on it.
The company plans to ramp up production further in the future, increasing to 47, 52 and then 57 planes per month at six-month intervals. However, the analyst expects these increases to occur at nine-month intervals instead.
Additionally, Boeing expects to reach production of seven 787 planes per month by the end of 2025, exceeding analysts' expectations. The quality and heat exchanger issues appear to be resolved as well.
The analyst noted issues with Boeing’s Defense and Space Systems (BDS), but said the business may be turning a corner following a major contract win and improved financial performance.
Harned said, “With the win of Next-Generation Air Dominance, now the F-47, Boeing will be back into major military aircraft development programs. Boeing also is in the running versus Northrop Grumman for the F/A-XX competition (replacement for F/A-18E/F), which could be announced within days. This will allow utilization of the company's St. Louis site and should attract substantial engineering talent, which would be beneficial for Boeing more broadly.”
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BA Price Action: At the time of writing, Boeing stock is trading 1.89% higher at $181.32, according to data from Benzinga Pro.
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