Unless something very substantial changes at aerospace company Boeing (BA) in the next few days, it will likely be facing a strike. The news hit shareholders fairly hard, and Boeing shares were down almost 3% in the wake of that news.
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Word from The Guardian says that the International Machinists Union has hit an “impasse” with Boeing, and the two remain “…far apart,” according to union president Jon Holden. Holden further noted, “We’ve laid out a path that can get us to an agreement that I believe our members can accept if the company comes along and proposes those things.”
Some points are familiar enough. The union is looking for pension benefits returned, as well as wage increases of around 40% over the next three to four years. Other points, however, are much less so: the union is looking to be included as part of Boeing’s quality management system, including altering some of the standard procedures used to put an aircraft together. Over the years, Holden noted, “Boeing has tinkered with that to a degree we’re not comfortable with,” prompting that to be part of contract talks.
The Polish Chinook
Even as Boeing’s union is potentially going on strike, Boeing is looking to make new inroads in product sales. It may have one, as it recently offered the CH-47F Chinook helicopter to the Polish government. There is no definitive agreement as yet, so it remains unknown just how many of said helicopters the Polish government would purchase, if any at all.
Further, Boeing will likely find competitors interested in getting that business. Lockheed Martin (LMT) has its Sikorsky division, after all, and the Sikorsky CH-53K King Stallion could step in to make a similar, or even better, offer.
Is Boeing a Buy, Sell, or Hold?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on BA stock based on 13 Buys, four Holds, and two Sells assigned in the past three months, as indicated by the graphic below. After a 26.95% loss in its share price over the past year, the average BA price target of $212.71 per share implies 35.3% upside potential.
