Just when you think things might be going well for aerospace stock Boeing (BA), along comes the kind of thing that makes you convinced Boeing is trying to snatch defeat from the jaws of victory. A growing problem for the F-47, and the very real potential of a new strike as early as Monday, are hitting Boeing hard. Investors are reconsidering, and shares dropped nearly 2% in Thursday afternoon’s trading.
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New reports suggest that the engine for the F-47 might be a while in coming. In this case, a “while” means “up to two years.” That alone is bad news enough for the project, because if the engine is tardy by a whopping two years, then it becomes entirely possible the whole project will be delayed until after the second Trump administration concludes.
The engine was supposed to be ready in the fourth quarter of 2027. That is still a substantial time off, but now, the engine will not arrive until the second quarter of fiscal 2030. A report from Breaking Defense noted, “Considering the aggressive timeline the Pentagon is pushing to fly the F-47 before the end of President Donald Trump’s term, a next-gen engine is likely out of reach for the fighter in the near future.” But that was just the start of the F-47’s problems, as another one is likely to rear its ugly head as early as Monday. The other is brewing as we speak in St. Louis, though it should be resolved well before the engine arrives.
(Another) Strike Incoming
Workers at three different Boeing plants in and around St. Louis may go on strike as early as Monday. Boeing made one more attempt to establish a new contract with the International Machinists and Aerospace Workers union, but that contract was pretty soundly rejected at last report. That set up the union for a week-long “cooling-off period” that will cool off absolutely no one, and a strike is set to follow from there.
So why did the union pass on the latest contracts? Reports note that the issue was not that the St. Louis plant would have received far smaller raises than their Everett equivalents under the new contract, but rather, the biggest issue is a matter of work schedules. Under the new agreement, Boeing would have been allowed to move workers from eight-hour shifts over five days to 10-hour shifts over four days. Some employees would even have been obliged to take on 12-hour shifts, but over three days.
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 18 Buys and two Holds assigned in the past three months, as indicated by the graphic below. After a 26.66% rally in its share price over the past year, the average BA price target of $256.68 per share implies 15.64% upside potential.
