Boeing Co’s (NYSA: BA) troubles carry on piling up, with the most recent blow coming from its 787 Dreamliner final week because the twin-aisle jet got here up with a brand new defect, leading to a slashed manufacturing price and delayed deliveries.
On the one hand, there’s Jim Cramer, who lashed out on Boeing’s administration, saying, “I’m sick of what’s happening”; however on the opposite, there’s Sheila Kahyaoglu of Jefferies who nonetheless drew a bullish case for Boeing on Tuesday.
Sheila Kahyaoglu’s remarks on CNBC’s “Squawk on the Road”
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Kahyaoglu reiterated her ‘purchase’ score on Boeing and declared a value goal of $300 per share. On CNBC’s “Squawk on the Street”, she stated:
There’s a whole lot of near-term turbulence in Boeing. However you need to look two, three years out to get to normalised ranges of free money stream. And that’s why we’re sustaining our purchase score on the inventory.
The COVID-19 disaster delivered a large hit to the aeroplane producer final 12 months because it wiped the demand for air journey. The pandemic got here on high of Boeing’s ongoing struggles associated to its bestselling 737 Max that confronted a brief ban after two deadly crashes.
We’re forecasting $8 billion of free money stream, and that’s excluding any working capital advantages as a result of you may’t assume that continues. Boeing traditionally trades at a 20% market low cost. Primarily based on that, at a 5.5% free money stream yield, we arrived at about $270 for the inventory. That’s our 2023 estimate, Kahyaoglu added.
Boeing’s free money stream at the moment stands at about $7 billion.
Jefferies analyst is pessimistic on United Airways
Kahyaoglu additionally highlighted throughout her interview with CNBC that she was a bit pessimistic on United Airways because it’s targeted on Asia, the place air visitors continues to be struggling to get better. UAL reviews its quarterly outcomes on Wednesday.
Boeing shares are up about 3% on Tuesday, however the $126 billion firm continues to be down greater than 20% from its year-to-date excessive in early March.
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