UBS Reiterates Buy Rating on Boeing (BA)

UBS analyst Gavin Parsons reiterated a Buy rating and $280.00 price target on Boeing (NYSE: BA).

The analyst commented, "­­­Boeing's $1bn investment to increase 787 production at Charleston is underway, with capacity for 16/mo targeted by 2028...We look at the sustainable demand for 16 787s per month, which would be a record level of production. Demand supports 16/mo in the early 2030s, which is our base-case assumption that allows ample time for the supply chain to ramp up. Key considerations: 1,000 787s in backlog with >600 orders past 3 years creates 16/mo visibility; Supported by 3% fleet growth + 3% replacement, matching historical average; 17% lower GDP-adjusted total widebody production in 2033 incl other models; $4bn of BA FCF growth 2033 vs. 2029 assuming a conservative 30% FCF margin; Benefits suppliers such as HXL, HWM, Leonardo, and Toray."

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Shares of Boeing closed at $230.95 yesterday.

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