
Posted April 28, 2025
By Davis Wilson
My Unpopular Thoughts on Boeing…
Is it finally time to buy Boeing?
This morning, Boeing (BA) shares are gaining altitude again after a Wall Street upgrade and better-than-expected first-quarter results.
On the surface, Boeing’s turnaround looks real.
The company posted an adjusted operating profit of $199 million in Q1 – well ahead of Wall Street’s $122 million estimate, and a sharp reversal from the $388 million loss a year ago.
Improvements were not just in commercial aircraft, but also across its defense and services businesses.
Wall Street is warming up too: 61% of Wall Street analysts now rate Boeing a Buy, compared to the S&P 500 average of about 55%, according to FactSet.
The average analyst price target sits around $196 – about 9% higher than today’s levels.
Yet despite the optimism, Boeing still faces major challenges.
- Deliveries to Chinese airlines have been paused again amid U.S.–China trade tensions.
- Quality control issues – exposed by the 737 MAX disasters and subsequent inspections – continue to haunt production.
- Boeing also carries a much heavier debt load after borrowing heavily during the pandemic.
In Q1 2018, before these crises, Boeing earned $2.5 billion in a single quarter.
The newly announced $199 million figure, while encouraging, is only a fraction of Boeing’s former profitability.
Valuation: A Mixed Picture
At $180 per share, Boeing’s valuation blends cautious optimism with notable risks. Here’s a detailed look at the key metrics:
- Backlog: Boeing’s order backlog stands at a robust $545 billion, covering 11 years of production at current rates.
- This includes 5,600 commercial aircraft and significant defense contracts, providing long-term revenue visibility and a buffer against short-term disruptions like the paused Chinese deliveries, which may cost $1-2 billion in 2025 revenue.
- Price-to-Earnings (P/E) Ratio: Boeing’s current P/E is “N/A” due to negative earnings. Analysts project a 2025 EPS of -$1.86 due to production and tariff costs, but a recovery to $4.20 by 2026 as 737 production ramps up.
- At $180, this implies a forward P/E of 43x for 2026 – steep compared to Airbus (18x forward P/E) and Lockheed Martin (16x), signaling even at these levels, BA stock isn’t cheap.
- Debt Load: Boeing’s debt load is a hefty $54 billion, accumulated during the pandemic to offset $20 billion in 737 MAX grounding costs and a travel slump.
- This debt, combined with rising interest rates, increases financial risk, with annual interest expenses estimated at $2.5 billion – eating into profitability and making deleveraging a priority for management.
Is Boeing a Buy at $180?
Boeing’s valuation at $180 is a high-risk, high-reward proposition.
The $545 billion backlog and defense segment growth are strong tailwinds, but the 43x forward P/E and $54 billion debt load signal caution.
Boeing looks like the classic "beaten down" stock ready for a rebound – and to some extent, it may be.
Improving earnings, a massive order backlog, and positive analyst sentiment are legitimate bright spots.
But when you dig deeper, Boeing isn't exactly cheap.
Meanwhile, there are plenty of cheaper, stronger opportunities available today — stocks with healthier balance sheets, faster growth, and better valuations.
I talk about them all the time in The Million Mission – think Nvidia, Meta Platforms, and Uber Technologies.
So if you’re looking for a turnaround play with a lot of baggage, Boeing might deserve a spot on your watchlist.
But if you’re serious about building wealth with the best risk/reward setups, there are far better options in this market right now.
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