Aerospace stock Boeing (BA) recently revealed its first quarter earnings, and the numbers were mostly good. But in the surrounding remarks, Boeing revealed a point that could pave the way for even better returns to come. Production on the 737 MAX line is ready to ramp up even further, which will help fill orders in that trump">massive backlog Boeing has on its books. Investors were reasonably pleased, and gave shares a fractional boost in Thursday afternoon’s trading.
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The numbers were fairly sound, though not without some issues. Boeing posted a loss of $0.20 per share adjusted, though analysts expected a loss better than four times that at $0.83 per share. Boeing also turned in a win in revenue, delivering $22.22 billion instead of the $21.78 billion analysts expected. This is good news by itself, though not completely; a loss is still a loss, even if it is less of a loss than expected.
But Boeing also has a clear run forward, according to CEO Kelly Ortberg. Ortberg revealed that customers have had good things to say about Boeing aircraft of late—which is true, as we have covered some of those praises previously from places like Ryanair (RYAAY)—and future production is on track. Certification of the 737 MAX 7 and MAX 10 are both likely to come in this year after extensive delays. “All systems are go,” Ortberg announced.
Freezing Fixes
In a more tangible form of support, Boeing revealed that the anti-icing solution for the 737 MAX line is actually working, and is currently seeing service. Formal certification trials are already under way, which will go toward the previously-noted goal of certifying the MAX 7 and MAX 10.
This is regarded as one of the last hurdles to be overcome before the two jets can get certified. Though Boeing is keeping quiet about how the fix works, a recently-approved patent suggests that Boeing may be closer than anyone realizes to completion. That in turn should get the designs approved, and fill a long-delayed hole in Boeing’s lineup.
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 15 Buys and one Hold assigned in the past three months, as indicated by the graphic below. After a 31.22% rally in its share price over the past year, the average BA price target of $273.77 per share implies 17.84% upside potential.
