So while most of the attention surrounding aerospace stock Boeing (BA) has been focused on the Air India disaster, some less-dramatic events have also taken place. Boeing brought back some formerly laid-off engineers, and is delivering satellites. These events may be mundane, but they left a positive taste in investors’ mouths, as Boeing notched up fractionally in Wednesday afternoon’s trading.
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Several engineers, who had roles similar to non-union workers elsewhere in the company, were reinstated at Boeing. Reports noted that the Society of Professional Engineering Employees in Aerospace (SPEEA) believed that previous layoffs actually violated a union contract between the union and Boeing. SPEEA pointed out that several non-union workers performing similar tasks were kept, while union employees were let go. SPEEA director of strategic development Rich Plunkett noted, “It appears finally something has shifted and there’s at least an appetite to see if we can work together.”
Thus, in a move to likely head off potential backlash from the union, Boeing brought back 58 union members, complete with back pay, compensation for benefits they had lost in the meantime, and removal of the layoff from their employment records. Given that 600 SPEEA members lost jobs back in the cuts that hit in January and February this year, the end result is a small but present victory.
Potentially Unnecessary Satellites
Then, in a move that might leave some scratching their heads, Boeing shipped another two O3b mPower broadband satellites, complete with some hardware fixes that may actually be unnecessary. The fixes were rendered unnecessary thanks to, of all things, solar storms.
The first six O3b mPower satellites ran into trouble out in medium Earth orbit (MEO), which led to their owner, SES, filing a $472 million insurance claim over them. Boeing agreed to supply extra satellites with some power fixes to ensure that performance expectations were upheld, a particularly good move for a company facing concerns about product quality. But as it turns out, the problems were originally caused by a “…buildup of protons that had been triggering sporadic power module failures on the satellites.” Solar storms, meanwhile, helped clear the buildup, and take the problem out of the picture.
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 17 Buys, two Holds and one Sell assigned in the past three months, as indicated by the graphic below. After a 13.82% rally in its share price over the past year, the average BA price target of $224.56 per share implies 6.39% upside potential.
