It was almost a year ago—roughly five and a half weeks shy—when aerospace stock Boeing (BA) saw a strike that shut large parts of the company down for weeks. And now, Boeing faces the exact same threat, though on a much smaller scale. Boeing investors saw a small problem with this, and sent. Boeing shares down fractionally in Monday afternoon’s trading.
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This strike hits workers in three states, reports note, with about 3,200 workers in total impacted. Boeing offered a contract that featured a 20% pay raise over the next four years, along with a $5,000 signing bonus and a set of other improvements like augmentations to retirement benefits. Boeing noted that the increases, all told, could raise employee pay an average of 40% once all the various parts of the deal were considered.
But Boeing workers turned it down, and launched their division’s first strike since 1996. IAM District 837 directing business representative Tom Boelling noted, “IAM District 837 members have spoken loud and clear, they deserve a contract that reflects their skill, dedication, and the critical role they play in our nation’s defense. We stand shoulder to shoulder with these working families as they fight for fairness and respect on the job.”
A Closer Look at the Contracts
So why ditch such a contract, particularly in the face of a certain degree of economic uncertainty brought about by multiple ongoing trade wars already in progress? One report noted that the proposal failed to “…adequately recognize the specialized skills and critical contributions their (the union’s) members make to national defense operations.”
Boelling noted that the contracts were not just a matter of “monetary compensation,” but rather about “…acknowledg(ing) their expertise in building complex military systems and their essential role in maintaining America’s defense capabilities.” How exactly such a thing would be accomplished is unclear at best, especially if Boelling et al are not immediately talking about dollars and cents. Just how many zeroes in the paycheck are required to recognize an essential role in maintaining America’s defense capabilities, anyway?
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 32.85% rally in its share price over the past year, the average BA price target of $257.21 per share implies 15.95% upside potential.
