The Boeing Company

(New York Stock Exchange)
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Somewhat Bullish +45

Morgan Stanley sees buying opportunity in beaten-down Boeing stock ...

Company update Labor strike Regulatory approval AI-generated analysis

πŸ“ˆ Morgan Stanley maintains an Equal-weight rating on Boeing with a $250 price target, citing a potential tactical buying opportunity if the SPEEA labor contract is ratified by October 1.

πŸ“‰ Boeing's stock has slid 9.7% in September due to a software bug affecting MAX 7 deliveries and certification delays on the 737 MAX 10.

πŸ’° The company holds a record backlog of $715 billion, including over 6,200 commercial airplanes, signaling sustained global demand despite recent operational hurdles.

βš–οΈ Q2 2026 results showed revenue of $24.6 billion from 171 deliveries, but the company reported a GAAP loss per share of -$0.67 and operating cash flow of $1.4 billion.

πŸ›‘οΈ Morgan Stanley asserts that Boeing's $10 billion free cash flow anchor remains intact, supporting a valuation based on a 20x multiple of normalized 2028 FCF per share.

⚠️ The 737 MAX 10 represents approximately 24% to 25% of the expected 2027 backlog, creating significant revenue exposure if FAA certification is delayed further.

🀝 SPEEA has recommended acceptance of the revised contract offer, and Morgan Stanley notes that this workforce differs significantly from the IAM machinists who struck in 2024.

πŸ“… The critical labor vote closes on October 1 at noon PST, with results expected that afternoon to determine if a major strike threat is lifted.

πŸ”§ Operators may convert MAX 10 orders to MAX 8 or MAX 9 variants, potentially preserving some 2027 revenue even if the specific MAX 10 certification slips.

πŸ“Š At current levels around $187, Boeing trades at approximately 15 to 16 times FCF yield, implying a 6.4% FCF yield if the $10 billion figure holds.

Bullish Signals
  • Morgan Stanley identifies a potential tactical buying opportunity in Boeing stock ahead of the October 1 SPEEA labor vote if the contract is ratified.
  • Boeing maintains a record backlog of $715 billion, including more than 6,200 commercial airplanes, demonstrating strong underlying demand from global airlines.
  • The company's Q2 2026 revenue reached $24.6 billion driven by 171 commercial deliveries, confirming continued operational scale despite recent losses.
  • Morgan Stanley believes Boeing's $10 billion free cash flow anchor remains intact to support its long-term valuation and price target of $250.
  • The SPEEA Professional and Technical Bargaining Unit Councils are recommending acceptance of the revised contract offer, reducing the risk of a major strike.
Risk Factors
  • Boeing faces certification delays on the 737 MAX 10 following the disclosure of a software issue that has already affected MAX 7 deliveries.
  • Consensus free cash flow estimates are likely to be revised lower as more details emerge regarding the software bug and certification timeline.
  • The 737 MAX 10 represents approximately 24% to 25% of Boeing's expected 2027 backlog, creating significant revenue exposure if certification slips further.
  • Boeing reported a GAAP loss per share of -$0.67 in Q2 2026, reflecting the financial impact of recent operational and regulatory challenges.
  • A rejection of the SPEEA contract offer on October 1 could push the earliest possible strike date to October 7, risking production disruptions.
Full Analysis
Morgan Stanley identifies a potential tactical buying opportunity in Boeing (BA) stock ahead of a critical labor vote scheduled for October 1 regarding the Society of Professional Engineering Employees in Aerospace (SPEEA). The firm maintains an Equal-weight rating with a $250 price target, implying roughly 33% upside from current trading levels around $187. This view hinges on the ratification of the revised contract offer, which would lift a significant labor overhang from a company facing multiple headwinds. Boeing's stock has been under pressure due to a software bug affecting the 737 MAX 7 deliveries and certification delays for the 737 MAX 10. Morgan Stanley notes that while consensus free cash flow estimates may be revised lower as details emerge, the company maintains a $10 billion free cash flow anchor supporting its valuation multiple. The 737 MAX 10 represents approximately 24% to 25% of Boeing's expected 2027 backlog, creating significant exposure if certification slips. Despite recent challenges, Boeing boasts a record order book backlog of $715 billion, including more than 6,200 commercial airplanes, indicating strong global demand. The company reported Q2 2026 results with revenue of $24.6 billion driven by 171 commercial deliveries, though it recorded a GAAP loss per share of -$0.67 and operating cash flow of $1.4 billion. Morgan Stanley distinguishes the current SPEEA workforce from the IAM machinists who struck in 2024, suggesting that a ratification could prevent a major disruption similar to the previous year's strike.