Boeing's Stock Drops On A New Rating

There wasn't much time for Boeing to convince one fence-sitter to change his mind about Boeing's plans.

‍

Northcoast analyst Chris Olin, who began covering the aircraft manufacturer fewer than three weeks ago, has downgraded the stock's rating to Sell from Hold and has set a $180 price target for the stock.

‍

The stock price of Boeing (ticker: BA) fell to $210.07 at midday Tuesday, the same day as Olin's shift. Shares of the S&P 500 were down 0.6% at midday and the Dow Jones Industrial Average was down 1.5% at midday.

‍

He changed his mind because he was concerned about Boeing's production schedule at the time he made his decision. A total of 570 planes are expected to be delivered by the company this year, an increase of 480 from last year. As a result of two deadly aircraft crashes or the Pandemic of Covid-19 that is anticipated in 2020, Boeing delivered 806 jets in 2018, the year before Boeing grounded its 737 MAX aircraft worldwide.

‍

Boeing has to increase production rates in order to be able to deliver 800 jets once again. There are still lingering issues in the aerospace supply chain that will make it difficult for Olin to hit that number. There is a shortage of certain engine parts, for instance, which has caused some problems in the past.

‍

Investors will closely monitor production in the coming months. Boeing's commercial airplanes CEO Stan Deal said Thursday that the 737 MAX productions will go up "soon." His statement caused the stock to jump roughly 2% Thursday.

‍

Boeing's stock still scores Buy from 61% of the analysts who cover it. S&P 500 stocks have an average Buy-rating of 58%. FactSet reports that two analysts have now rated shares as Sell. Stock on the S&P 500 has an average Sell-rating of 7%.

‍

Currently, analysts are projecting a $232 price target for the stock, about $20 higher than where the stock is at the moment.

‍

There have been a few bulls lost by Boeing lately. Among the 20 analysts who rated the stock Buy at the start of the year, FactSet had 20 ratings. As of today, there are 17 in the group.

‍

In spite of the fact that shares have been rising, switchovers are taking place. There has been an increase of 11% in the stock price over the past 12 months. In the past few days, the stock market has lost 10% of its value. It has been predicted by investors that deliveries would recover in the coming months.

‍