Boeing (NYSE:BA) stock has dropped 1097% over the past month as of close on October 18. Shares gained momentum in the previous week after the United States and China reached a limited trade deal. U.S. President Donald Trump predicted that the deal would hold huge benefits for Boeing.
In comments over the weekend, Trump said that the deal could lead to as much as $20 billion in sales of Boeing airplanes. He also predicted that it would spur billions in purchases of agricultural goods. Boeing declined to comment on the statements from the President.
However, a lingering crisis came back to bite Boeing hard over the past week. New controversy was sparked after text messages emerged between senior pilots that suggested Boeing was fully aware of the dangers of the new flight-control system in the 737 MAX.
Two crashes have been linked to those issues that cost the lives of 346 people. The texts indicated that pilots were concerned about the system and hit this information from the Federal Aviation Administration(FAA) to keep it out of pilot training manuals and MAX training courses.
This crisis is not going away for Boeing. The FAA has demanded an explanation for the document, and there could be severe internal and legal repercussions that reach the very top at Boeing after this revelation.
The news is poorly timed for the stock after a seemingly positive breakthrough between the U.S. and China, but I’m staying away from Boeing until we get more clarity on this unfolding drama.
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