The Boeing Company (BA)

They have a full order book on the commercial side and a full order book on the military side. Will the 787 delay cost them? Sure, but only by a small amount. Why I like this company:

1. Full order book
2. Able to raise prices on aircraft as their only rival pays costs in Euros
3. It will take years for any military cut backs to unwind
4. Coming recession will lower their costs for production

There is a lot of speculation Boeing won't do well because airlines won't be able to afford the new jumbos they had on order. Maybe so, but commercial aircraft are only one segment of Boeing's business, and the cost of oil will eventually force every carrier to switch to more efficient planes. Today's downgrade by Goldman just looks like another discount to me.

Huge backlog of orders, growing international market, increased defense spending. Price near 3 year low, trading less than 10 times forward earnings. 100% order book filled through 2011.

Their only significant competitor has stumbled and they are preparing to roll out the next generation product. Today's results were good. This is among the bluest of blue chips and blue chips are ready to take the lead after doing very little in recent years.

In short, Boeing is a good bet to outperform.

For now, Boeing is struggling. Wait until the dollar stabilizes, and foreign orders will start flooding in. They lost the Airbus deal and I don't see that turning around.

Well after sifting thru all the carnage of the last couple days, 138 dollar oil, and the largest sell-off in months, its time to start poking around for some bargains!!. I found one!!. BOEING!!! (BA) , this one has been on my wish list from the get-go, and is finally priced right. With several U.S. carriers this week replacing their older, less fuel efficient planes with the Newer Next Generation 737's (737-800, 737-900ER) other airlines are going to have to follow suit to stay competitive. The dollar falling and huge sales in Asia and the Middle East already on the books,Boeing has plenty of work for the coming years. The 787 Dreamliner will be on line soon, hopefully with no further delays in setting up the production line, (20% more fuel efficient then the Airbus A330). A p.e. of 13.22 and a forward p.e. of 12.90, near its 52 week low, Boeing is ready for a green thumbs up!!

Boeing is one Great Company for One. The mid-large size aircraft market consist of really only two competitors, airbus/Boeing and the past couple of years have been hard on airbus, although Boeing’s 787 is not without its problems. However that 787 will be the bread and butter for the future of Boeing. The best yet even if airbus can come through with their A350 they are over 5 years behind and its current design doesn't beat the 787's fuel efficiency. Note airbus doesn't have cash to finance the A350 and its more of a remake of the A330 than a whole new aircraft.

The other cat in the bag is the US Air Force tanker contract. If airbus wins that gives then a cargo plant to product aircraft and has the potential to create some minor-medium problems to Boeing. However after reading the 67 page GAO report on how the Air Force messed up... the competition was close BUT there was a couple of KEY area's that the A330 didn't meet. IE. Eads/Airbus said the A330 could exceed it max operational speed and dive speed given from the FAA. However the aircraft isn't designed to handle those stresses and most likely would come apart in flight.

Recently Sachs gave BA a sell, which I believe represent their lack of knowledge in the aircraft manufacturing business. Here is a good quote on the 787 regarding high fuel cost and the delays “How can we afford to not buy the 787.” Although the air carrier industry is struggling they are still in great competition such that any aircraft that offers a fuel savings over the other wins, hence more orders for fuel efficient planes.

BA is a long bet, and given their help in each of china/Russia/Japan smaller manufacturing aircraft they are set for the long term.

BA is fighting EADS and the A380.
BA has a very good solution in the works , the 787, at a time when high fuel efficiency counts a lot and a lot of airlines must renew their aging fleets. A new, capable CEO and possible additional Defense contracts should help

Cramer quote:

In 2007, I believe Airbus will admit the sad truth that it can't make the big planes it promised so many. That would allow Boeing to become something it has always wanted to be: a monopolist. And what a great time to be a monopolist! Labor costs are down, raw material costs have stabilized and prices can be raised. Some think this stock has peaked; they ain't seen nothing yet. I like the prospects for a 30% increase and a price of $120, made up in big increments at the reporting of each quarterly upside surprise.

http://www.t...29314_2.html

BA has regained status in the commercial plane market and AIRBUS has lost status. Sales are consistant. Military sales are continuing and a new defense contract to bolster border security has been signed.

It has taken several years, but Boeing is now kicking Airbus's butt. The need for new, fuel efficient aircraft is great in the airline industry worldwide...look for Boeing to sell more than they can build!

Too many shakeups at Airbus (i.e. unable to deliver A-380 to launch customers). Boeing's 787 will save our weak U.S. airlines - CAL has several coming. I am positive more mergers ahead for the industry, and BA is a great play with their cost-saving new aircraft.

Despite strong performance in the last few years, still cheap on the numbers. Company has a huge backlog and is showing vastly improved manufacturing execution. Airbus is not going to present meaningful competition for another two years at least. Defense business (about half of revenues) is picking back up as well. Should be a strong performer despite historical cyclicality concerns.

Boeing is going gang busters. BCA has tons of opportunities out there. American Airlines is about 6-8 months away from placing a Huge order.. AA has quite a few MD80s that are going to have to be retired in the next 5-8 years. The replacement can be a 737 or a 787... Boom in China is also going to help them.. Looking at the future Boeing is strategically investing in China and India... Areas of growth...

This is a blue chip Dow Jones company that pays a dividend. It's tied to the aerospace cycle, which has historically lasted about 7 years. We're about mid-way through this cycle. An economic development consultant I work with assures me that the pipeline is strong for the next several years. And their only competitor, Airbus, is in complete disarray right now and is unable to even make planes for the time being. I expect Boeing to take a lot of their orders in the months ahead. This stock is moving strongly right now and is a big reason the Dow is powering to new highs. I think that this stock will continue to appreciate over the next couple years.

Production delays in 787. Today anounced on time for prototype lauch, but production significanly more difficult than prototype launch. Boing is outsourceing production of sub componants for final assembly. This is the first time they are attempting to build commercial airliner with this model. Forsee potential issues as the kinks are ironed out.

Return to profitability in the next fiscal year, gain of a foothold into the border, security market, failures at airbus, growth of unmanned systems in US military, and resurgence of the american airline industry are all major positives in the next couple years for Boeing. Add to that growing demand for planes in Asia and this one is a winner.

Even though we are in a recession and there is no reason to rush it, this is kind of ridiculous. First test flight in 2007?! At this rate, they won't test this till 2010. I mean this is really hurting the company's image, they are losing tons of money. Boeing is really at the top of my list for companies that needs new direction and management. I understand safety is a first, but why predict you can test something at a date you can't...that falls on management.

I expect Boeing to continue to stumble towards bankruptcy until they get new direction.

David Ristau

President, The Oxen Group
www.theoxengroup.com

Overpriced; problems are inevitable.