One of the big problems for Boeing (NYSE:BA), in its attempt to acquire Spirit AeroSystems (NYSE:SPR) was defining what exactly to do about parts construction. There may actually be a solution brewing here, and investors were happy to see it. So happy, in fact, they sent shares up nearly 3.5% in Wednesday afternoon’s trading. Word out of Spirit says that, with “…a high degree of confidence,” it’s figured out a way to step up its own production to meet the rate and quality expectations for parts demanded by Boeing, particularly for the 737 MAX jet line.
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Boeing is still struggling under a combination of regulatory demands and investor demands to get its production back up to 38 per month starting in July.
Meanwhile, it’s also suffering under newfound troubles from its credit rating, which has been hit hard despite a pretty successful bond sale. But Spirit’s plan might help out here, and it will reveal more details about this on its earnings call, set for next week.
Boeing May Have a Ready Pivot in Hand
Separately, if this whole “airplane” thing doesn’t work out, Boeing may have a ready pivot in hand. Reports from Fox Business note that a Boeing 737 in Bali had been “repurposed” into a “private jet villa.” A surprisingly luxurious concept, the cockpit has had its instrumentation removed and replaced with a jacuzzi and what looks like hardwood flooring.
A bonfire area is located outside of the craft—and no, the emergency slide doesn’t look like it was included—along with custom fittings inside. Perhaps Boeing could one day make a case for unusual real estate; many places are still in the midst of a housing shortage, after all.
Is Boeing Stock a Buy or Sell?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on BA stock based on 15 Buys, eight Holds, and two Sells assigned in the past three months, as indicated by the graphic below. After a 15.38% loss in its share price over the past year, the average BA price target of $224.65 per share implies 29.56% upside potential.
