Kristine Liwag from Morgan Stanley, an analyst at Morgan Stanley, has reduced the Boeing price target to $288.00 per stock (NYSE:), and now targets $230.00. This is in recognition of her overestimations.

Lower price targets reflect higher execution risks and that positive catalysts, which were anticipated for April, are likely to manifest at a later stage. This delay was largely caused by the Boeing 737 NG incident in China.

Liwag is still Overweight, as he remains bullish about the recovery of aerospace after COVID-19. We don’t expect that the industry will revert to global shutdowns. In 2022, the analyst expects BA will return to positive FCF for the first times in five years.

“Despite these execution risks, Boeing emerges from the worst period of its operation in its history.” The first year since 2018 has seen positive free cash flow. In 2022, the first year since 2018, aircraft cancellations are significantly down. However, orders have increased in positive numbers. The Boeing 737 MAX 8 has a significant backlog,” a MS analyst told clients.

Liwag listed five catalysts that should be watched in 2022.

1. It will be the first MAX revenue flight in China.
2. FAA approves the 787 fix;
3. China’s review of its Zero COVID-19 Policy;
4. FAA Certification of the 737 MAX 7 by the FAA;
5. FAA Certification of the 737 MAX 10 by the Year-End 2022

Liwag stated, “We are aware that Boeing may not be able to certify these planes by the year’s end. This would require the program to conform to the Aircraft Safety and Certification Reform Act which could take significant time and resource.”

Boeing stock closed yesterday at $177.97

By Senad Karaahmetovic