Veteran analyst roasts Boeing stock after mistakes

The legion of mistakes has been monumental in recent years for Boeing (nay) the nation’s only sizeable aircraft manufacturer.

Here is just a sample of his troubles:

• 2018-2019: Two Boeing 737 Max 8 crashes kill a total of 346 people, leading to 20-month grounding of planes in the US
• 2020: The FAA is based on eight 787 Dreamliners.

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• 2021: Boeing reveals it found empty tequila bottles on a plane that was being rebuilt for use as Air Force One.
• 2022: Boeing announces delays for two planes to be used as Air Force One, causing losses to exceed $2 billion.
• 2023: Boeing announces that production and delivery of the 737 Max will be delayed due to a faulty manufacturing process by one of its suppliers.
• January 2024: A door stopper explodes on an Alaska Airlines 737 Max 9, blowing a hole in the plane and requiring an emergency landing.
• February 2024: The Federal Aviation Administration said Boeing lacked a “fundamental commitment to safety.”
• March 2024: Boeing CEO Dave Calhoun resigns.

Boeing’s new CEO, Kelly Ortberg, has been tapped to clean up the company’s mess.

Getty/TheStreet

• April 2024: The FAA announced it would investigate a whistleblower’s allegations of manufacturing problems with the 777 and 787 Dreamliners that could lead to crashes.
• June 2024: After years of delays, Boeing sends its Starliner spacecraft to the International Space Station. The two astronauts were due back in about a week. But problems with the craft will keep them there for up to 90 days.
• June 2024: Calhoun tells Congress that Boeing’s safety culture “is far from perfect.
• July 2024: Boeing agrees to plead guilty to fraud for its role in the 2018-19 accidents.
• September 2024: About 33,000 Boeing workers go on strike.

So it’s not much of a surprise that Boeing stock is down 60% over the past five years and 42% so far this year alone. If it weren’t for the nation’s only major aircraft manufacturer and a major contractor for the Pentagon, Boeing could be in danger of collapsing.

Related: Boeing’s hardball game with striking workers backfires

Analyst is bearish on Boeing despite selloff

In any case, TheStreet Pro analyst Stephen Guilfoyle, whose career stretches back to the 1980s at the New York Stock Exchange, sees Boeing’s pain continuing.

As of June 30, the company had $52.904 billion in debt, of which $4.765 billion is due within 12 months, the veteran investor said. Boeing also had $11.864 billion in accounts payable and $8.407 billion in pension liabilities.

Technical analysis factors are also bad for the company.

“The relative strength of the action is weak, the daily moving average convergence/divergence oscillator is negative, with two of the three components inside sub-zero territory,” Guilfoyle said.

Related: Analyst adjusts Boeing stock price target on strike impact

“The stock hasn’t touched its 50-day SMA since mid-August and hasn’t touched its 200-day SMA since last winter after coming close in late July.”

Don’t stand in front of the cannon

On Thursday, the stock traded at $151, its lowest level since October 2022. “I don’t see any reason to sit in front of a cannon,” Guilfoyle said.

He quotes an Air Force sergeant who expressed pessimism about Boeing 40 years ago. “What he told me decades ago kept me from doing more than trading with BA,” Guilfoyle said.

The fund manager buys and sells:

• Experts cite stocks to buy after Fed rate cut
• Cathie Wood exits $23 million in growth tech stocks
• Best value fund manager says Alphabet is deep value stock

He frequently buys large stocks of defense contractors for sustained periods, but never Boeing.

“I wouldn’t touch the Boeing with a 10-foot pole. I wouldn’t invest your money in Boeing, even if I hated your guts.”

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