THE BOEING COMPANY (BA): what the price requires
At today's price, THE BOEING COMPANY (BA) is priced for today's economics sustained for ~6.9 years. boothcheck doesn't publish a fair value or a price target; it shows what the price assumes, so you can judge whether that bar is too high.
Generated: 2026-07-14 · Exported: 2026-07-16 · Source: https://boothcheck.com/report/BA
Headline
| Field | Value |
|---|---|
| Ticker | BA |
| Company | THE BOEING COMPANY |
| Current price | $215.71/sh |
| Composition | Commercial Airplanes (BCA) 46% / Defense, Space & Security (BDS) 30% / Global Services (BGS) 23% |
What The Price Requires (Inversion)
The assumption today's price embeds, recovered by inverting the valuation.
| Field | Value |
|---|---|
| Inversion basis | whole-company |
| Operating margin needed | 10.3% |
| Operating margin (mid-cycle) | 7.0% |
| Margin expansion implied | +3.3pp |
| Trailing margin (depressed year) | -4.6% |
| Must persist for | 6.9y |
| Multiple paid | 36x mid-cycle operating income |
The operating-margin requirement is derived from the framework's value band at year 12, a separately labeled basis from the headline growth/duration solve.
Solve inputs: computed at a 9% cost of capital; growth searched up to the 25% self-funding ceiling; each 1pp moves the implied horizon ~1.9 years.
How unusual the bet is: elevated
| Reference | Value |
|---|---|
| vs own history | +0.71σ |
| sustained it ~6.9 years at this level | 22% |
| implied end-window share | 1% |
Valuation X-Ray
The price is justified by relative-multiple and growth-DCF.
How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.
| Family | Median price/FV | Models | Reads |
|---|---|---|---|
| Asset | — | 0 | — |
| Earnings | — | 0 | — |
| Relative | 0.92x | 3 | justifies |
| Growth | 0.69x | 3 | justifies |
Families that justify the price: Relative, Growth
The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 8.1%); the inversion above states its own rate.
Per-Model Detail (n=6)
| Model | Family | FV | Price/FV | Applicable | Methodology |
|---|---|---|---|---|---|
| DCF Perpetual Growth | Growth | $0.00 | — | no | FCF base $0.5B, growth 25% (input: historical growth), terminal g 4.0%, WACC 8.0%, 7yr projection |
| DCF Exit Multiple | Growth | $236.07 | 0.91x | yes | Exit EV/EBITDA: 31.2x / 33.2x / 35.2x (bear / base = today's held flat / bull), 7yr |
| Relative Valuation | Relative | $233.97 | 0.92x | yes | P/S fallback (negative EPS): Sector P/S 2.0x × TTM revenue — excluded from consensus |
| Simple DDM | Growth | — | — | no | — |
| Two-Stage DDM | Growth | — | — | no | — |
| Simple Excess Return | Asset | $7.60 | 28.38x | yes | Book value floor: BV/sh $7.60, ROE negative (excluded from median) |
| Two-Stage Excess Return | Asset | $6.84 | 31.54x | yes | Book value with convergence: BV/sh $7.60, ROE converges to ke (excluded from median) |
| Discounted Future Market Cap | Growth | $312.99 | 0.69x | yes | Rev $92.2B, growth 30% (input: historical growth; tapered), Terminal P/S: 1.5x / 1.8x / 2.2x (bear / base = today's held flat / bull, cap 12x) |
| Peter Lynch Fair Value | Relative | $0.00 | — | no | Negative/zero EPS — earnings-based value floored at $0 |
| Margin Trajectory | Growth | $541.33 | 0.40x | yes | Margin ramp: -8% → 12% over 7yr, rev growth 30% (input: historical growth; tapered) |
| Earnings Power Value | Earnings | — | — | no | — |
| Residual Income | Asset | — | — | no | — |
| Graham Number | Asset | — | — | no | — |
| EV/EBITDA Relative | Relative | $61.19 | 3.53x | yes | EBITDA $6.33B × sector EV/EBITDA 14.0x |
| FCF Yield | Earnings | — | — | no | — |
| SBC-Adj FCF Yield | Earnings | — | — | no | — |
| Ben Graham Formula | Earnings | — | — | no | — |
| ROIC-Justified P/B | Asset | $0.72 | 299.60x | yes | BV $7.60 × (ROIC 0.8% / WACC 8.0%) (excluded from median) |
| P/Sales Sector | Relative | $233.97 | 0.92x | yes | Revenue $92.18B × sector P/S 2.0x |
| PEG Fair Value | Relative | — | — | no | — |
| Earnings Yield | Earnings | — | — | no | — |
| Funds From Operations Multiple | Relative | — | — | no | — |
| Clinical Phase NPV | Growth | — | — | no | — |
| Merton | Asset | — | — | no | — |
| V5 Mechanical | — | — | — | no | — |
Solvency
| Field | Value |
|---|---|
| Net debt | $36.2b |
| Net debt / NOPAT (after-tax) | 7.47x |
| Net debt / operating income (pre-tax) | 5.90x |
| Share count CAGR (dilution) | 7.4% |
| Burning cash | no |
Leverage and coverage are computed on normalized mid-cycle operating income (mid-cycle margin 7.0%); the trailing year was depressed.
Interest expense is not separately reported in the latest filings, so interest coverage cannot be computed.
Bullet Takeaways
- Boeing is three businesses stitched together: commercial airplanes carrying roughly 46% of the weight, defense and space near 30%, and a higher-margin services arm around 23% that sells spare parts and maintenance on a global installed fleet the company recognizes part by part at discrete unit prices.
- The single largest risk is that the profit engine still runs in reverse on its newest programs: Boeing booked roughly $4.9 billion in reach-forward losses on the 777X in 2025 alone, and a fixed-price development contract can turn a win into a multi-year charge before a single jet ships at a profit.
- Watch the 737 rate ramp: production moved off 42 a month toward 47 after a mid-2026 regulatory review, with the company aiming higher into year-end, and that cadence is the closest thing to a switch that flips commercial airplanes from cash drain to cash generator.
Bull Case
Start with where the price sits against the ways you can value the company, because the gap is the whole argument. Boeing at $222.74 trades above every static lens you can point at it. The asset-value methods barely register, because book value per share is thin and the company is not currently earning its cost of capital. The peer-multiple lens, run on sales because there are no positive earnings to divide into, lands just under the price. Only the forward-growth methods reach it, and one of them, the margin-recovery path, actually sits well above today's price if you assume operating margins climb from negative territory back toward the low teens over the next several years. What that pattern means in plain terms: you are not being asked to pay a premium over a proven earnings stream. You are being asked to believe the recovery happens. If it does, the same methods that look stretched today look cheap in hindsight.
The recovery has a mechanism, and it is the aftermarket. Global Services is the part of Boeing that already works. It sells spare parts and maintenance against a worldwide installed base of Boeing aircraft, and the economics are structurally better than building airplanes: the 10-K describes commercial spare parts as having "discrete unit prices that represent fair value" with revenue recognized "at the point in time" each part ships, which is a cleaner, less capital-intensive way to make money than absorbing years of development cost before delivery. Every jet Boeing has ever delivered is a services annuity, and the fleet only grows as deliveries climb. This is the segment that carries margin while commercial airplanes claws back to breakeven.
Defense is the second leg, and it is winning the contracts that set up the next several years of visibility. Boeing took the U.S. Air Force's Next Generation Air Dominance fighter, designated the F-47, in a program the Air Force structured to run for decades. That sits on top of an existing franchise, and the segment reports its results the way a program business should: the 10-K states the CEO "uses Segment operating (loss)/earnings to allocate resources" across the portfolio, which is the discipline a turnaround requires. The bull case does not need commercial airplanes to be fixed tomorrow. It needs services to keep printing, defense to keep booking, and the 737 line to walk its rate up, which management has now begun doing under a restored regulatory relationship. Analysts covering the name carry a mean target of $274.14 against today's $222.74, and the distance between those two numbers is the recovery the forward methods are already trying to price.
Bear Case
The competitive and structural threat to Boeing is not a rival stealing share tomorrow. It is that the company's own development programs keep converting into losses before they convert into cash, and the calendar for fixing that keeps moving right. The 777X is the clearest case. Boeing recognized roughly $4.9 billion in reach-forward losses on that program in 2025, a figure the 10-K states directly, and the first delivery slipped to 2027. A reach-forward loss is not an accounting quirk you grow out of; it is the company telling you that estimated program costs now exceed estimated program revenue, so the future units are booked at a loss before they fly. The 10-K names the same pressure across the fleet, citing delays on "the 737, 777X and 787" tied to production challenges, certification, and higher labor and supplier costs. Airbus is not standing still while this plays out, and every quarter the 777X stays grounded is a quarter a competitor's widebody takes the order.
Now put that against what the price requires. At $222.74 the market is paying roughly 37 times the company's mid-cycle operating income, and that multiple only makes sense if company-wide operating growth holds at close to its self-funding ceiling for about seven years. That is the crux: the near-term pace is within what Boeing can deliver, but the demand is on duration, on holding it that long. History is unkind here. Of comparable fast-growers, only about a fifth sustained that pace over a stretch of roughly seven years. The price is not betting on a good quarter. It is betting on seven years of them, from a company that has spent the recent past absorbing charges rather than compounding.
The balance sheet is the amplifier, not the cushion. Boeing carries about $36 billion of net debt and gross debt near $57 billion, which is more than five times a normalized year of operating income before tax. The company is not currently burning cash, but it is not deleveraging from strength either: the share count has grown at roughly 7.4% a year, meaning the recovery is being partly funded by issuing stock, and the 10-K flags that a delay in ramping production, a decline in outlook, or a shift in demand "may adversely affect our ability to fund our operations and financing or contractual commitments." Fixed-price defense work compounds the risk: the same reach-forward mechanism that hit the 777X lives in the development contracts, where the 10-K discloses a $291 million reach-forward loss recognized on winning a competition years before the aircraft delivered. A recovery bought with dilution and leverage clears a higher bar than one funded by its own cash, and that is the bar this price sets.
Valuation
What the price is really betting is that Boeing earns its way back to a margin it does not currently make, and does it for years. At $222.74 the market is paying about 37 times the company's mid-cycle operating income, and inverting that back into an assumption, the price requires company-wide operating growth held near its self-funding ceiling for roughly seven years. Boeing earns about 4.6% operating margin on a normalized basis today against an implied requirement closer to 10%. The near-term rate is within reach; the stretch is the duration, and only about a fifth of comparable fast-growers have sustained that pace over a horizon this long.
The methods split cleanly along that same fault line. The asset-value lens does not apply in any useful way, because book value per share is roughly $7.60 and the company is not earning a positive return on it. Peer multiples, run on sales since there are no positive earnings to anchor a price-to-earnings figure, land just below the price at a sector price-to-sales read. Only the forward-growth family reaches today's price, and it does so by crediting the recovery: one cash-flow method gets to the price by holding today's EV/EBITDA multiple of about 34x flat for the life of the forecast, while the margin-recovery method, which assumes operating margins climb from negative territory back toward the low teens, actually lands well above the price. That is the signal to read honestly. This is not a value stock where cheap static methods disagree with a demanding growth story. It is a stock where the static methods cannot frame the bet at all, because there is no current earnings stream to value, and the entire price rests on the forward margin recovery being real.
Against the cohort, Boeing's aerospace peers show what functioning margin discipline looks like, and its own segment reporting is built for that scrutiny, with the CEO using "Segment operating (loss)/earnings to allocate resources" across the portfolio. The peer set is dominated by names that already convert aerospace revenue to profit rather than charges, and the distance is not subtle. Solvency bounds the downside without cushioning it: about $36 billion of net debt sits at more than five times a normalized year of pre-tax operating income, the share count has been rising rather than shrinking, and the company holds only a modest roughly $1 billion of off-operating equity interests. A recovery is fundable here, but it is fundable through leverage and issuance, not from a fortress balance sheet, and that is the constraint the price underwrites alongside the margin bet.
Catalysts
The near-term story is the 737 rate ramp, and it is moving. After a capstone review with the FAA in late May 2026, Boeing cleared the path to lift 737 MAX production from 42 aircraft a month toward 47, with the company targeting further increases into year-end. Q1 2026 revenue came in at $22.2 billion, up 14% year over year on higher commercial deliveries of 143 aircraft, though the company remained loss-making as production investment continued to weigh on results. Most analysts now model free cash flow turning positive across 2026, which would mark the inflection the entire recovery thesis depends on. The next earnings print is the checkpoint for whether the rate ramp is translating into cash.
The wide-body and certification calendar cuts the other way. The 777X first delivery has slipped to 2027, with FAA certification now sequenced behind the 737 MAX 7 and MAX 10, both of which are targeted for certification during 2026. That ordering means the two narrow-body variants are the nearer catalysts, and any further 777X slippage extends the program losses already booked. On the structural front, the acquisition of Spirit AeroSystems was finalized after the FTC accepted a consent order in February 2026 addressing input-access concerns for competitors, bringing a critical fuselage supplier back in-house.
Defense supplies the multi-decade backdrop. Boeing's F-47 Next Generation Air Dominance award, taken from Lockheed Martin, is structured as a program that could generate orders across decades and anchors a defense backlog that already runs deep. The legal overhang has moved toward resolution as well, with the criminal matter tied to the 737 MAX concluding in a corporate guilty plea in late 2025. Wall Street's consensus target of $274.14 sits above today's price, reflecting a Strong Buy lean, and the gap is the market pricing the turnaround it has not yet seen in the cash statement.
Peer Cohorts (Per Segment, With Filing Citations)
Commercial Airplanes (reported)
- GD (GENERAL DYNAMICS CORPORATION)
- (no filing in the citation store)
- TXT (Textron Inc.)
- (no filing in the citation store)
- HEI (HEICO CORPORATION)
- (no filing in the citation store)
- TDG (TransDigm Group Incorporated)
- (no filing in the citation store)
Defense, Space & Security (reported)
- HON (Honeywell International Inc)
- (no filing in the citation store)
- GE (GENERAL ELECTRIC COMPANY)
- (no filing in the citation store)
- MMM (3M COMPANY)
- (no filing in the citation store)
- ITW (ILLINOIS TOOL WORKS INC)
- (no filing in the citation store)
- ROP (ROPER TECHNOLOGIES INC)
- (no filing in the citation store)
Global Services (reported)
- HEI (HEICO CORPORATION)
- (no filing in the citation store)
- TDG (TransDigm Group Incorporated)
- (no filing in the citation store)
- RTX (RTX CORPORATION)
- (no filing in the citation store)
- GE (GENERAL ELECTRIC COMPANY)
- (no filing in the citation store)
- CW (CURTISS-WRIGHT CORPORATION)
- (no filing in the citation store)
Methodology Note
- Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
- Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
- Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
- Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.
Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.
Sources
U.S. Air Force NGAD award announcement, March 2025 · MarketBeat analyst consensus, June 2026 · CNBC, May 27 2026 · Boeing Q1 2026 earnings release, April 22 2026 · MarketBeat analyst commentary, June 2026 · Aviation Week, 2026 · Manufacturing Dive / FTC, February 2026 · U.S. Air Force NGAD award, March 2025 · U.S. Department of Justice, 2025 · MarketBeat, June 2026