Boeing Company Continues to Be a Value Play, Despite Meteoric Rise
Shares of America's biggest plane manufacturer rose substantially last week following news that the company expects its 2018 production levels and profitability to be higher than expected. With everything seemingly going right for the defense and aerospace manufacturer, it is hard to argue that Boeing is anything other than a value play at this point in time.
The company announced it anticipates it will be able to improve upon its record-setting production levels this past year in 2018, with an additional 7% improvement over and above the 763 jets delivered this past year.
Boeing has simply found new and better ways of improving efficiency, and from that standpoint, I remain extremely bullish on the long-term ability of the company to grow top and bottom line numbers as we head into 2018.
Perhaps Boeing's biggest asset is its order backlog, and for some time investor have focused on the company's ability to produce planes at a faster rate as the key factor which will determine profit growth, and therefore stock price growth, over time.
With Boeing's management team doing an amazing job of working on ways of improving efficiencies, the current valuation multiple used to value Boeing simply appears to be too low; factoring in efficiency improvements, improved defense spending, and a profitable airline sector, I anticipate the company's backlog and production numbers to continue to grow meaningfully this year, further improving my long-term outlook for Boeing compared to its global peers.
Invest wisely, my friends.