Sometimes, the worst thing that can happen is when an organization’s own safety panels take issue with its decisions. Aerospace stock Boeing (BA) found itself in a similar situation as a NASA safety panel took issue with NASA’s handling of the Starliner incident. This did nothing particularly good for Boeing, as investors sent shares down fractionally in Tuesday afternoon’s trading.
Claim 70% Off TipRanks This Holiday Season
- Unlock hedge-fund level data and powerful investing tools for smarter, sharper decisions
- Stay ahead of the market with the latest news and analysis and maximize your portfolio's potential
The safety panel in question—the Aerospace Safety Advisory Panel (ASAP)—recently released a report that made NASA itself look terrible, pointing to “…a wave of uncertainty that lurked behind Boeing’s unfortunate saga….” It also, reports noted, cast “…doubt over whether NASA can properly address safety concerns with future missions like Artemis.”
ASAP, perhaps armed with the benefit of hindsight, asserted that NASA should have declared the entire incident a “mishap.” Such a declaration would have immediately launched an investigation from the NASA safety office. Former shuttle commander and ASAP member Charlie Precourt noted, “The ASAP finding is the lack of a declared in-flight mishap or high visibility close call contributed to an extensive, excessive … period of time where risk ownership and the decision-making authority were unclear.”
Improving Picture
We have noted, over the last few weeks, that Boeing is doing quite well right now, bringing in fresh contracts from the United States Navy and other branches of the military. This in turn is giving analysts a reason to pay more attention, as Moody’s, just about two weeks ago, gave Boeing credit a solid rating as well.
The new contracts are contributing to better cash flow, and better cash flow makes debt repayment that much more likely. Moody’s recently reaffirmed Boeing’s Baa3 senior unsecured rating, and revised its outlook, now declaring Boeing “Stable” as improvements in quality, safety, and liquidity took hold.
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 13 Buys, two Holds and one Sell assigned in the past three months, as indicated by the graphic below. After a 20.91% rally in its share price over the past year, the average BA price target of $249.92 per share implies 15.38% upside potential.
