Boeing stock rose after catching an upgrade from a historically cautious analyst. Investors should take note.
Monday, Vertical Research Partners analyst Rob Stallard upgraded shares of Boeing to Buy from Hold. His price target went to $270 from $242.
It’s “the end of the beginning,” wrote Stallard. Aerospace demand is in good shape, Boeing’s supply-chain problems are abating, and the company’s defense business is stabilizing after a period of losses on fixed-priced contracts following Covid-induced inflation.
The culture is improving, too. “While it’s more intangible than the actual businesses, we also think that Boeing has made good progress tackling its corporate culture,” added Stallard. “Under CEO Kelly Ortberg, we have seen a far less arrogant tone…This improvement has also been noted by customers and suppliers, with a number now commenting that they have much more faith in Boeing actually delivering on its projections.”
Boeing stock was up 1.1% at $232.20 in premarket trading, while S&P 500 and Dow Jones Industrial Average futures were up 0.2%.
It has been a long road back for Boeing, which hasn’t reported a full-year profit since 2018, the year before the second tragic 737 MAX crash that was tied back to faulty flight control software.
Wall Street doesn’t expect a profit in 2025, but sees profits returning in 2026. Stallard, who downgraded Boeing stock back in 2020, expects a per-share loss of $2.36 for 2025 and earnings per share of $2.86 for 2026, jumping to $6.20 a share in 2027.
There is no mystery to what will grow earnings at Boeing. It’s plane deliveries. Boeing is expected to deliver about 580 planes in 2025. Stallard expects about 680 in 2026 and 760 in 2027.
Overall, 81% of analysts covering Boeing stock now rate shares Buy, according to FactSet. The average Buy-rating ratio for stocks in the S&P 5oo is about 55%. The average analyst price target is about $260 a share.
Coming into Monday trading, Boeing’s stock was up 30% this year. Investors have been encouraged by the company’s progress in improving quality and production rates.
Write to Al Root at allen.root@dowjones.com
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