Latest Developments:
Boeing (BA) has faced ongoing challenges, with a disappointing 2Q24 performance, marked by a 14.6% YoY decline in revenues and negative EPS. Additionally, strikes and safety concerns, including issues with its 737 and 787 aircraft, have added to operational disruptions. However, Boeing's proactive actions, such as the appointment of a new CEO and the acquisition of Spirit AeroSystems (SPR), suggest a shift toward resolving these issues. Despite the setbacks, demand for Boeing's products remains strong, supported by growing passenger traffic and increased defense spending.

Investment Case:
Boeing is poised for a turnaround as core demand drivers remain robust. The aviation industry's capacity struggles, passenger traffic growth, and a surge in defense spending all point to sustained demand for Boeing’s aircraft. The company’s proactive steps, including leadership changes and the acquisition of SPR for improved safety and quality control, provide optimism. Despite concerns over liquidity and ongoing challenges, Boeing's significant backlog, valued at $515 billion, offers strong revenue visibility.

Company's Valuation:
Boeing's stock, currently trading at $153.93, is undervalued relative to its potential, with an estimated fair price range between $99 and $260. This suggests an attractive risk-reward profile, with a potential upside of 69.6%. Investors should consider accumulating shares as Boeing works through its challenges and benefits from strong demand.

Disclaimer: The above is an excerpt on a report written by our close associate, Selendis Research. Check out the full report here on Seeking Alpha. All information provided is intended solely for general informational purposes. Seven Insights does not take into account individual financial goals or situations and does not provide personalized investment advice. Seven Insights is not a licensed securities dealer, broker, U.S. investment adviser, or investment bank.