Dust Clears for Boeing After Upgrade

The stock is coming off its fifth-straight weekly loss today

Digital Content Manager
Mar 23, 2020 at 10:51 AM
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Perpetually struggling Boeing Co (NYSE:BA) is getting some respite this morning, up 4.3% at $99.12 after Goldman Sachs upgraded the aerospace specialist to "buy" from "neutral." The analyst said traders can get BA shares for a steal right now, seeing as the stock is down 80% from its 2019 highs, and predicts a strong resurgence in air travel once issues caused by COVID-19 are resolved. Goldman also said it was hopeful that government stimulus would be made available and added that Boeing has strong liquidity to cover the deeply negative free cash flow it has suffered this year. 

While Boeing hit a seven-year low of $89 early last week, it appears that this level is now behaving as a floor for the equity. BA still has a ways to go if it wants to stage a real rebound, however. For the year, the stock is down 70% and just strung together five consecutive weeks in the red. 

Another bull note could help put more wind at Boeing's back, and right now there is plenty of room for upgrades among the brokerage bunch. Just three in coverage consider BA a "strong buy," compared to 11 "hold" ratings, and one "sell." The consensus 12-month target price of $203.94, on the other hand is more than double current levels. 

Drilling down, BA's Schaeffer's put/call open interest ratio (SOIR) of 0.51 sits beneath all other readings from the past year This suggests that short-term option players haven't been more call-heavy during the past 12 months.

 

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