Boeing Stock Falls After Another In-Flight Issue, Bear Note

Bernstein lowered its price objective to $240 from $272

Digital Content Manager
Apr 8, 2024 at 10:27 AM
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Boeing Co (NYSE:BA) is in the spotlight yet again, after news that the Federal Aviation Administration (FAA) is investigating an incident in which a Boeing 737-800 engine cover flew off during a Southwest Airlines (LUV) flight and hit the aircraft's wing flap on Sunday. Additionally, CEO David Calhoun reportedly earned a 45% raise to $33 million last year.

The equity also attracted a price-target cut from Bernstein to $240 from $272. The analyst in question said the equity is in a "purgatory situation" amid recent issues. Brokerages are still bullish, however, with 15 of the 21 firms in coverage calling the stock a "buy" or better, while the 12-month consensus target price of $244.80 is a 33.7% premium to current levels.

The shares were last seen down 0.2% to trade at $182.73. The 20-day moving average is acting as pressure, but a new floor has also emerged at the $180 level. BA is down 29.4% in 2024.

While calls outpace puts on an absolute basis, Boeing stock's 50-day put/call volume ratio over at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) stands higher than 98% of annual readings. This means puts have been getting picked up at a quicker-than-usual clip lately.

What's more, the equity's Schaeffer's Volatility Scorecard (SVS) sits at a high 98 out of 100. This means BA exceeded option traders' volatility expectations in the past 12 months.


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