With the Starliner astronauts now looking more like Gilligan’s Island with every passing day—that “three-hour tour” turned out to be “15 years”—it becomes easy to wonder if aerospace firm Boeing (BA) will keep the Starliner project alive. Some believe that may not happen, but the concept seems to be intriguing investors, who boosted Boeing stock by over 2% in Thursday afternoon’s trading.
The litany of problems for the Starliner project is already massive. Component failures, a massive cost overrun, and now, the final indignity of having its crew rescued by its biggest competitor, SpaceX. Naturally, Boeing insists that the priority is “first and foremost, on the safety of the crew and spacecraft,” but that is not exactly an endorsement of the project as a whole.
With all of these points and several others—like NASA’s recent pan of Boeing’s entire space program, calling its contributions to the Moonbound Space Launch system over budget and outdated—it would be easy to think Boeing might just give up altogether. Throw in recent word that the International Space Station itself is due to be decommissioned in 2030, and that may just be the final nail in the coffin for Boeing’s space ambitions.
Boeing’s New Plane Is Too Big for UAL
And closer to Earth, Boeing faces new issues. Boeing’s new widebody aircraft did not sit well with United Airlines (UAL), and for one frightening reason: it is just too big. Word from United says that the jet is simply too large for the multi-hub network that United uses and will work better with airlines that use a single hub.
Interestingly, the 777X is already being regarded as a good airplane. Still, as the largest twin-engine aircraft in production, it just might be too big for many users, especially in the U.S. market. “A smaller widebody is actually better” for such situations, noted Patrick Quayle of United.
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, five Holds, and one Sell assigned in the past three months, as indicated by the graphic below. After a 23.68% loss in its share price over the past year, the average BA price target of $216.59 per share implies 24.41% upside potential.
