“A Dual Engine Failure is Extremely Rare”: Boeing Stock (NYSE:BA) Slips Despite New Air India Findings

More news recently emerged about the Air India disaster, and it is starting to look good for aerospace stock Boeing (BA), as their role in the crash seems like it may be minor, if it even exists. A new report from the Wall Street Journal spelled out some new specifics, but concerned investors were still sufficiently cautious to pull back on Boeing shares fractionally in Wednesday afternoon’s trading.

The latest reports noted that, when Air India Flight 171 went down, it had an “emergency power generator” active. That led some to question if the engines were actually working correctly when the plane took off to begin with. This is opening up a new possible solution to the plane’s fatal crash, the report noted, especially since engine failure this catastrophic seems to be a very rare condition.

The emergency generator, known as a “ram air turbine,” assists in electrical generation during emergency situations. Normally, the plane’s engines provide all the electrical power a plane needs, so for the ram air turbine to be active suggests that the engines had somehow failed. The ram air turbine deploys automatically, reports note, or it can be deployed manually if a pilot believes that both engines went down. But this, noted aerospace safety consultant Anthony Brickhouse, is “…extremely rare.” Naturally, the investigation remains ongoing, and thus, more exact findings may await.

Taking Hits in Paris

But more difficult for Boeing itself was the Paris Air Show, which Boeing largely had to take a knee on in light of the Air India disaster that may or may not have been Boeing’s fault. Reports note that its immediate competitor, Airbus (EADSY) struck while the iron was hot, and landed orders for 16 different aircraft from two airlines on the event’s third day. For the whole event so far, Airbus landed 148 orders, with another 258 potentially to come later. Either of the two will typically disclose such orders on the event’s third day, which is the day before the event goes live to the public.

Boeing may have made some sales at the event, but reports noted that Boeing will be postponing any such announcements thanks to the Air India crash. Boeing also cut off any “commercial announcements” it would have brought out, which means that Boeing’s presence at the Paris Air Show might not produce much fruit at all.

Is Boeing a Good Stock to Buy Right Now?

Turning to Wall Street, analysts have a Strong Buy consensus rating on BA stock based on 16 Buys, three Holds and one Sell assigned in the past three months, as indicated by the graphic below. After a 13.59% rally in its share price over the past year, the average BA price target of $221.56 per share implies 11.81% upside potential.

See more BA analyst ratings

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