Boeing Stock was best for investors and business people. Investors looking for stocks to buy can find companies with more robust, more-consistent profits growth and more trustworthy stock technicals.
Boeing stock earnings have evaporated as 737 Max deliveries and products are on hold; also the coronavirus’s cover hits air flying demand. Is Boeing stock a great buy now? Investors should watch at the aerospace giant’s fundamentals and the B.A. property chart.
Boeing Stock Fundamental Analysis
Boeing earnings-per-share growth has averaged 0% over the past three years, according to IBD Stock Checkup. In Q4, Boeing swung to a loss of $2.33 per share from a profit of $5.48 a share a year ago.
Revenue has contracted by 3% on average over the past three years. In Q4, the top line fell 37% to $17.91 billion, as 737 Max deliveries remained halted. Commercial airplane unit revenue fell 67% to $7.5 billion as shipments plunged 67% to 79 aircraft.
Boeing’s resistance and space business are likewise confronting negative news. The KC-46 tanker for the U.S. Air Force is more than two years behind schedule and has cost Boeing $3.5 billion in charges for cost overruns. Boeing had to halt deliveries repeatedly after debris found in delivered tankers. After reporting Q4 earnings, an SEC filing disclosed that Boeing took a $108 million charge in Q4 for the KC-46 tanker.
Boeing also produces the F/A-18 Super Hornet for the U.S. Navy and foreign militaries. But in the latest budget request, the Navy wants to cut short the purchase of upgraded Super Hornets and shift the money to its own Next Generation Air Dominance platform and other critical aviation investments. However, the Air Force’s 2020 budget includes eight updated Boeing F-15X fighters, and its fiscal year 2021 budget request includes orders for 12.
The company’s space business also suffered a setback December 20 when its Starliner capsule failed to reach the proper orbit for docking with the International Space Station. The company also took a $410 million pretax Q4 charge related to the Starliner space capsule.
In February, NASA revealed that a previously undisclosed software issue discovered during the Starliner’s flight that could have destroyed the space capsule. A NASA inspector general report also flagged continued delays in Boeing’s Space Launch System rocket.
Boeing Stock Technical Analysis
B.A. stock auctions off on the Boeing 737 Max crash and aftermath. It has seen additional volatility as air travel restrictions implemented, and demand drops as the deadly COVID-19 spreads.
In March, B.A. stock fell to its lowest levels since April 2013, according to MarketSmith chart analysis. Shares plunged about 80% from an intraday high reached on March 1, 2019, in mid-March before turning up again.
B.A. stock auctions off on the Boeing 737 Max crash and aftermath. The S&P 500 index, is the blue line in the chart below and has been trending lower since February 2019.
Boeing stock’s CAN SLIM fundamental metrics include a weak 12 Composite Rating out of a best-possible 99 and a dismal 7 EPS rating.
Boeing 737 Max Probes
The Securities and Exchange Commission is reportedly investigating the aerospace giant’s financial disclosures related to the jet’s grounding.
Congress, the Justice Department, FBI, and the Transportation Department inspector general’s office also have been looking to see if the Dow Jones giant provided misleading information about the Boeing 737 Max to regulators and customers.
Members of the House unloaded a trove of damning new messages at a transportation hearing in October that laid out warnings from employees before the fatal crashes. And at a House Transportation and Infrastructure Committee hearing in December, a former Boeing employee testified about 737 Max warnings he sent a management that overworked employees were making mistakes.
Preliminary findings from a House investigation that began a year ago were released in early March, saying the FAA “failed in its duty” and that its review of the troubled plane was “grossly insufficient.” The report also called out Boeing for having a “culture of concealment.”
Boeing Stock Not A Buy
Boeing 737 Max jets are still grounded, and U.S. aircraft have taken the stream off their calendars well into 2020. The coronavirus is hitting global air traffic, depressing already weakened demand for wide-body planes like the 787.
After an epic free fall, B.A. stock rebounded a bit but is falling again, and shares are well below their 50-day and 200-day lines. The stock has been underperforming the S&P 500 for the better part of a year.
Shares fell to the lowest levels in seven years in early March. Boeing stock is also not in any buy zone and is not forming a discernible pattern.
A dozen Companies cut and Suspended
As many organizations have cut or suspended profits lately to protect money during the questionable effect of the coronavirus pandemic on the economy, the falling apart payout picture has become a familiar refrain in this column.