Baird reiterates a “Buy” rating for Boeing while two traders call for caution

By: Ruchi Gupta
Ruchi Gupta
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on Jul 23, 2021
  • Baird analysts reiterated a "Buy" rating for Boeing
  • Todd Gordon is cautious on Boeing, considering it has lost its uptrend since 2009
  • Boeing has not traded above $285 since March 2020

Boeing (NYSE: BA) is among the Dow stock that has underperformed this month, but early in the week, they sprung to life following a Baird analysts’ bullish call. The stock was up 2% on Wednesday, but it is still 7% down this month, remaining the second worst-performing Dow component.

Baird reiterated a “Buy” rating

Baird analysts reiterated a “Buy” rating on Boeing on Wednesday, stating that it is currently a top pick in the aerospace sector. The firm cited healthier demand market conditions coupled with the opening of the economy, which will allow the company’s management to concentrate on turnaround efforts that include possible restructuring.

Are you looking for fast-news, hot-tips and market analysis? Sign-up for the Invezz newsletter, today. managing director Todd Gordon who had held the stock before, told CNBC’s Trading Nation why he would be steering clear. He said:

It’s tough to make an argument to hold this stock. If you just look at the chart, it’s lost its uptrend since 2009 and until it can break back above there, about $285, I think it’s is a no touch.

Boeing closed at $222.54 on July 22, but since March 2020, the stock has not reached above the $285 level.

Gordon highlighted the issues the aircraft manufacturer has been dealing with in recent times, including issues with models such as the 787 Dreamliner and production cuts as reasons for being cautious. Interestingly, the bearish take in Boeing goes back to the 737 Max model that was grounded in 2019 after two deadly crashes.

Quint Tatro says Boeing is taking positive steps

Contrary to Gordon’s perspective, Joule Financial founder Quint Tatro is optimistic and sees the company’s steps as a positive. Tatro said:

They seem to be doing everything right. They cut their dividend to protect cash flow, they have a much improved balance sheet and obviously they’re going to participate with the reopening.

Despite all the positives he sees in Boeing, Tatro pointed it is not adequate for him to buy in into Boeing for now, Tatro explained:

It seems like every time this thing gets some momentum and looks to take flight, there seems to be some headwinds, so it’s a no touch for me here. I think there’s better opportunities out there.

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