Stop me if any of this sounds familiar. Aerospace stock Boeing (BA) is currently facing a new strike, and it has no talks scheduled with the strikers. It has also pulled a signing bonus off the table altogether. If it sounds like Boeing is trying to take the same hard line that it took in Seattle, then there may be a reason. But Boeing investors were not that happy about Boeing attempting to crush the strikers, and sent shares down modestly in Monday afternoon’s trading.
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Not only did Boeing declare that there were no talks scheduled with striking machinists, it also noted that the previous contract offer is still in place, less the $5,000 signing bonus. The bonus, Boeing noted, was only available if they ratified the contract by August 3 at 11:59 p.m. Since they did not, the bonus was removed.
The St. Louis strikers objected to the $5,000 signing bonus, noting that strikers on the West Coast managed to land a $12,000 ratification bonus when they signed their agreements. Even non-union Boeing employees managed to get a $12,000 retention bonus as well as an extra 9% in their paychecks. So for St. Louis to stretch out the strike, in view of that, makes sense. However, Boeing noted that production is actually still in progress on several major releases, including Joint Direct Attack Munitions. Ground testing on the MQ-25 and flight testing on the T-7 are both still in progress as well, with Boeing’s “non-striking workforce” still in full swing.
Return of the Globemaster
Meanwhile, reports note that the C-17 Globemaster is potentially poised to make a comeback. It was a major part of military operations as far back as the 1990s, capable of carrying huge payloads and making landings on very short runways, making it a vital part of ferrying cargo from one place to another.
While budget cuts and declining demand meant the end of the C-17, reports noted that demand is starting to pick up again for a plane that can handle large amounts of cargo landing in rough terrain. This is making some at Boeing consider once more getting the Globemaster up and running again before a replacement can be set up. And, reports note, other countries are starting to look at the Globemaster line, as they were not able to get orders in before production shut down over 10 years ago.
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 19 Buys and three Holds assigned in the past three months, as indicated by the graphic below. After a 39.6% rally in its share price over the past year, the average BA price target of $256 per share implies 13.27% upside potential.
