On Wednesday the International Association of Machinists approved a new contract with Boeing in which the company agreed to make its 737 Max jet with union labor in Washington state. Yesterday after getting the machinist all-clear the National Labor Relations Board (NLRB) dropped its lawsuit against Boeings investment in South Carolina writes WSJonline.com in The NLRBs Boeing Sham.
The NLRB is supposed to be a fair-minded referee in labor disputes making sure neither side breaks the law. But the board put its fist squarely on the union side to make Boeing pay a price for moving one of its 787 assembly lines to a right-to-work state to make sure Boeing never did that again and to demonstrate to any other unionized company that its investment is at risk if it makes the same decision.
If you havent been following this government-union-management interaction or Gibson Guitar or Solyndra or myriad other cases which show beyond a shadow of a doubt that our government is run by thugs and thieves start with the referenced WSJ article.
But were here to look at investments and The Boeing Company (BA $71.93) is #36 on the Fortune 500 list with $64 billion in annual revenues. Boeing is a competitive manufacturer in the aerospace and defense industry. Boeing is finishing out a calendar year with flat earnings per share (EPS) of approximately $4.46 per share. Wall Street estimates show Boeings EPS are projected to grow 9 and 17 for fiscal years 2012 and 2013.
Boeings 2012 price earnings ratio (PE) is 14.5 and the dividend of $1.68 per share provides a current yield of 2.34. Boeings long-term debt to capitalization ratio has averaged 92.86 over the last three years per a 12/10/11 Standard & Poors Research report.
During the recent decade Boeings stock rose from a low of $24 just before the second Gulf War to a high of $107 then fell back down to $29 with the 2008 Financial Meltdown. The stock began a price recovery in late 2008 and has spent the last two years trading between $57 - $80. The stock could easily retrace its recent high of $80 with the next bull run in the market where it will likely meet with some resistance.
Although Boeing is a large industry-dominant consistently profitable company its annual revenue and earnings figures are all over the map. Over the 10 years through 2010 sales grew at a compound annual rate (CAGR) of 2.3 earnings from continuing operations grew at a CAGR of 4.5 EPS at 6.2... reports Standard & Poors Research. Combine those lackluster numbers with Boeings very high long-term debt levels and its degree of volatility during down markets and we see a successful giant of a corporation lacking any profound reason for investors to buy its stock.
If I owned Boeing stock Id put in a sell order at $80. Whether you are a trader growth investor value or growth & income investor there are better stock opportunities elsewhere in the U.S. stock markets. To keep apprised of stock research and investment opportunities visit www.GoodfellowLLC.com and use the one-month free trial subscription offer to access the research.
Readers should consult their investment and tax advisors to determine suitability risk and taxation.
Crista Huff is a retired stockbroker from a NYSE member investment firm. She writes about market-timing at Goodfellow LLC and is active politically.
On Wednesday the International Association of Machinists approved a new contract with Boeing in which the company agreed to make its 737 Max jet with union labor in Washington state. Yesterday after getting the machinist all-clear the National Labor Relations Board (NLRB) dropped its lawsuit against Boeings investment in South Carolina writes WSJonline.com in The NLRBs Boeing Sham.
The NLRB is supposed to be a fair-minded referee in labor disputes making sure neither side breaks the law. But the board put its fist squarely on the union side to make Boeing pay a price for moving one of its 787 assembly lines to a right-to-work state to make sure Boeing never did that again and to demonstrate to any other unionized company that its investment is at risk if it makes the same decision.
If you havent been following this government-union-management interaction or Gibson Guitar or Solyndra or myriad other cases which show beyond a shadow of a doubt that our government is run by thugs and thieves start with the referenced WSJ article.
But were here to look at investments and The Boeing Company (BA $71.93) is #36 on the Fortune 500 list with $64 billion in annual revenues. Boeing is a competitive manufacturer in the aerospace and defense industry. Boeing is finishing out a calendar year with flat earnings per share (EPS) of approximately $4.46 per share. Wall Street estimates show Boeings EPS are projected to grow 9 and 17 for fiscal years 2012 and 2013.
Boeings 2012 price earnings ratio (PE) is 14.5 and the dividend of $1.68 per share provides a current yield of 2.34. Boeings long-term debt to capitalization ratio has averaged 92.86 over the last three years per a 12/10/11 Standard & Poors Research report.
During the recent decade Boeings stock rose from a low of $24 just before the second Gulf War to a high of $107 then fell back down to $29 with the 2008 Financial Meltdown. The stock began a price recovery in late 2008 and has spent the last two years trading between $57 - $80. The stock could easily retrace its recent high of $80 with the next bull run in the market where it will likely meet with some resistance.
Although Boeing is a large industry-dominant consistently profitable company its annual revenue and earnings figures are all over the map. Over the 10 years through 2010 sales grew at a compound annual rate (CAGR) of 2.3 earnings from continuing operations grew at a CAGR of 4.5 EPS at 6.2... reports Standard & Poors Research. Combine those lackluster numbers with Boeings very high long-term debt levels and its degree of volatility during down markets and we see a successful giant of a corporation lacking any profound reason for investors to buy its stock.
If I owned Boeing stock Id put in a sell order at $80. Whether you are a trader growth investor value or growth & income investor there are better stock opportunities elsewhere in the U.S. stock markets. To keep apprised of stock research and investment opportunities visit www.GoodfellowLLC.com and use the one-month free trial subscription offer to access the research.
Readers should consult their investment and tax advisors to determine suitability risk and taxation.
Crista Huff is a retired stockbroker from a NYSE member investment firm. She writes about market-timing at Goodfellow LLC and is active politically.
