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The Federal Aviation Administration recently approved Boeing to raise its 737 MAX production rate from 38 to 42 aircraft per month, reflecting renewed regulatory confidence after previous manufacturing and safety issues.
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This boost in production capacity, paired with operational improvements and leadership changes, signals that Boeing is making progress toward resolving prior challenges and focusing on growth in both revenue and margin recovery.
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We’ll explore how the FAA’s decision to lift production limits reshapes Boeing’s investment outlook and competitive position.
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To own Boeing stock, investors need confidence in the company’s ability to restore commercial airplane profitability, manage high debt, and ramp up 737 MAX and 787 production as global travel demand rebounds. The FAA’s approval to increase 737 MAX monthly output is a pivotal short-term catalyst, creating room for stronger revenue recovery, but the biggest risk remains unresolved certification delays and persistent negative margins in the commercial division; while the news is positive, the margin risk is still significant.
Among Boeing’s recent announcements, the Norwegian Group’s additional order for 30 Boeing 737-8 jets directly connects to the production increase. This demand supports the case for higher unit volumes and revenue growth, provided Boeing can convert new orders into profitable deliveries and sustain operating improvements, which are crucial to improving its financial flexibility and restoring confidence.
But despite progress in production, investors also need to be mindful of ongoing certification challenges with the 737-7 and 737-10, as…
Read the full narrative on Boeing (it’s free!)
Boeing’s outlook anticipates $114.4 billion in revenue and $7.1 billion in earnings by 2028. This is based on analysts forecasting 14.9% annual revenue growth and a $18.0 billion improvement in earnings from the current $-10.9 billion loss.
Uncover how Boeing’s forecasts yield a $252.57 fair value, a 16% upside to its current price.
Seventeen separate Simply Wall St Community fair value estimates for Boeing range from US$206.79 to US$326.80 per share. Many see upside, yet certification and margin risks continue to weigh on expectations for a sustained turnaround.
