Hold Rating for Boeing Amid Geopolitical Tensions with China and Potential Market Reallocation

Boeing (BA – Research Report), the Industrials sector company, was revisited by a Wall Street analyst yesterday. Analyst Ronald Epstein from Bank of America Securities reiterated a Hold rating on the stock and has a $185.00 price target.

Ronald Epstein’s rating is based on the current geopolitical tensions affecting Boeing’s business with China. The halt in Boeing deliveries to China, as reported by Bloomberg, is a significant factor, given that China accounts for a substantial portion of the market for large civil jets over the next two decades. This situation presents a challenge for Boeing, as China has a considerable backlog of Boeing aircraft orders.
Despite the current challenges, Epstein sees potential for Boeing to reallocate aircraft originally intended for China to other markets, such as India, which may require additional capacity. Additionally, the dependency of China’s aerospace industry on U.S. suppliers suggests that the current halt in deliveries may not be sustainable in the long term. These factors contribute to the Hold rating, indicating that while there are risks, there are also opportunities for Boeing to navigate the current geopolitical landscape.

In another report released yesterday, Morgan Stanley also maintained a Hold rating on the stock with a $175.00 price target.

Based on the recent corporate insider activity of 33 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of BA in relation to earlier this year.