On October 26, investment research firm Langenberg raised its rating on Boeing from Hold to Buy, setting a price target of $250. Analyst Brian K. Langenberg stated that although production increases for the 737 and 787 aircraft have been delayed, the company's massive order backlog and the growth prospects of its defense business remain attractive.
Currently, Boeing's total backlog stands at $745 billion, with order volumes across all business segments achieving double-digit year-over-year growth. Langenberg believes that Boeing's long-term outlook has not fundamentally changed due to short-term production delays.
At the same time, Boeing's market valuation has fallen significantly. When the firm turned bullish on Boeing again, its market capitalization was approximately $15 billion lower than before, offering investors a more attractive buying opportunity.
The expansion of the defense business is also a key basis for the upgrade. Boeing secured the U.S. Navy's next-generation F/A-XX fighter program contract in the third quarter, and combined with the previously awarded U.S. Air Force F-47 fighter program, the company has further expanded its presence in advanced fighter aircraft beyond its existing F-15 and F/A-18 businesses, providing support for future order growth in the defense segment.
However, Boeing's recently reported third-quarter financial results still reflect operational pressures. Quarterly revenue rose 4% year-over-year to $24.19 billion, slightly below the market expectation of $24.39 billion; adjusted loss per share was $0.34, wider than the expected $0.24.
Nevertheless, Boeing still generated positive free cash flow of $464 million in the third quarter, with commercial aircraft deliveries reaching 161 units, the highest since 2018. The company also maintained its long-term cash flow target, aiming to achieve $10 billion in free cash flow by 2029.
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