The deal between China and aerospace stock Boeing (BA) proved to be disappointing when it was first announced, and the disappointment seems to have continued straight through to today. While Boeing made a huge move, selling 200 planes in one go with the potential for nearly three times that number to come, investors were expecting more off the bat. Boeing stock dipped modestly in Monday afternoon’s trading.
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While the order was indeed substantial, the original projections calling for an order of 500 aircraft were simply too good to let go quietly. Boeing, for its part, considered the order a success, even offering something in the way of confirmation of the order. The statement from Boeing noted, “We had a very successful trip to China and accomplished our major goal of reopening the China market to orders for Boeing aircraft. This included an initial commitment for 200 aircraft, and we expect further commitments will follow after this initial tranche.”
With word out that China will need 8,800 planes over the next 20 years, this could be just the start of something much bigger. And with Boeing set to release some new models, China may well be pacing itself. But for now, the loss of some major potential orders is hitting Boeing where it lives.
How the Wings Work
Meanwhile, a new report emerged about the Boeing 777X, which is easily one of the most hotly anticipated aircraft of the current age. One feature in particular is drawing plenty of attention: foldable wingtips.
Those wingtips allow the 777X to use conventional runways, but need to be extended before takeoff. Reports note that the 777X has a system in place that offers “…escalating levels of alert” before a takeoff where the wingtips have not been correctly deployed. Additionally, a separate mechanism has the wingtips automatically fold when the aircraft reaches 50 knots of ground speed.
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 7.43% rally in its share price over the past year, the average BA price target of $274.14 per share implies 26.17% upside potential.
