The Boeing Company

(New York Stock Exchange)
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Slightly Bullish +15

Should You Buy Boeing Stock While It Still Loses Money On Airplanes? - Trefis

AI-generated analysis

πŸ“‰ Boeing stock is down 12% year-over-year while the company reports a negative operating margin of 5.4% over the trailing twelve months.

πŸš€ The company delivered 171 airplanes in Q2 2026, achieving its highest quarterly delivery volume since 2018.

πŸ’° Boeing's commercial airplane unit posted a positive operating margin of 0.6% in Q2 2026 despite thin cash margins on the 737 and 787 programs.

πŸ”§ Management expects 737 program margins to return to 2018 levels only by the end of the decade due to current pricing pressures.

πŸ› οΈ The 737 production line is ramping toward a rate of 47 airplanes per month with no immediate supply-chain constraints identified.

✈️ The 787 program has stabilized at 8 airplanes per month in Charleston, pending a recovery of GE engines to unlock the next step.

⚠️ Boeing recorded a $280 million charge for the Air Force One program in Q2 2026 affecting its financial results.

🀝 The SPEEA union labor contract covering Puget Sound engineers is set to expire in October 2026, posing a potential operational risk.

πŸ“ˆ Boeing's shares are currently trading at approximately 83% of their 52-week high following the recent earnings report.

Bullish Signals
  • Boeing delivered 171 airplanes in Q2 2026, its highest quarterly total since 2018, demonstrating strong production execution.
  • The company achieved a positive operating margin of 0.6% in the second quarter of 2026, signaling an improvement from the negative 5.4% trailing twelve-month figure.
  • Management confirmed there are no supply-chain constraints preventing the 737 line from ramping up to 47 airplanes per month.
Risk Factors
  • The commercial airplane unit continues to operate with negative cash margins on the 737 and 787 programs, running only slightly above breakeven.
  • Boeing recorded a $280 million charge for the Air Force One program in Q2 2026, impacting its quarterly financial performance.
  • The SPEEA union labor contract covering Puget Sound engineers expires in October 2026, creating a genuine risk of potential labor disruption.
Full Analysis
Boeing (BA) stock has declined 12% over the past year, trading at $208.87, primarily due to persistent operating losses in its commercial airplane unit despite a narrowing overall company loss rate. The company's operating margin improved from negative 12.4% a year ago to negative 5.4% recently, with the second quarter of 2026 showing a positive operating margin of 0.6%. This improvement occurred while Boeing delivered 171 airplanes in the quarter, marking its highest quarterly delivery volume since 2018. The core financial challenge remains within the commercial airplane unit, where the 737 and 787 programs operate with cash margins only slightly above breakeven. Management attributes these thin margins to pricing pressures that dissipate as aircraft are delivered, distinguishing this from structural cost issues. While fixed-cost absorption improves at higher volumes, management projects that 737 program margins will not return to 2018 levels until the end of the decade. Production ramp-up faces specific constraints tied to supply chain and engine recovery rather than immediate capacity limits. The 737 line is ramping toward a rate of 47 airplanes per month, while the 787 has stabilized at 8 units per month pending a GE engine recovery. Operational risks include a $280 million charge for the Air Force One program and potential labor disruptions as the Puget Sound engineers' union contract expires in October 2026.