How to buy Boeing shares (BA)
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Is it the right time to buy Boeing shares once again, or will this stock never recover? To help you answer that question, you can read this Boeing stock investing guide. Hopefully, after reading this, you’ll be able to decide whether Boeing is a worthwhile investment for your needs.
Compare the best Boeing trading platforms
Here, we’ve listed our top choices of brokers that offer Boeing shares. Based on objective criteria, these platforms provide plenty of functionality so both beginners and professional investors can quickly and easily trade financial assets, including Boeing stock.
How to buy Boeing stock, a step-by-step guide
The process of investing in a company is simple nowadays, so don’t worry, even if you’re new to stock investing. These are the steps to follow in order to complete your investment:
- Find a broker. Finding a great broker to work with is essential to get the right tools and support to help you make sound investment choices. Select your broker and create an account to have access to trading, information, and everything you need to invest in financial markets. You should also select a broker according to your experience level, focusing on benefits and features.
- Analyse a Boeing Chart. One of the trading tools that your broker provides is a charting application. This will be necessary to understand how Boeing’s share price behaves so you can find an appropriate price point to initiate your trade. You should always use all the information you have available, so you can make data-driven investing decisions.
- Start Trading. Once you have a better insight into your chosen stock, it’s time to place a trade. You should fund your new trading account and follow your broker’s guidelines on how to buy shares. If you want to create a diversified portfolio, you can add more assets to your portfolio, depending on the broker’s offering. Check fees and commissions associated with your trades before opening the position.
What is Boeing?
Boeing is headquartered in Chicago, Illinois. It is one of the largest companies in the world. If you want to learn more about this business, check out the next sections.
Boeing Business Model and Revenue Streams
Boeing is an American company best known for making commercial jetliners. Apart from passenger aircraft, Boeing also manufactures aircraft for the military, satellites, missile defence, human space flight, and launch systems and services. It also offers leasing and product support services.
With a $140 billion market cap, Boeing is one of the largest companies in the world. Its highest recorded revenue was in 2018, reaching $101 billion, and it managed to convert $10.45 billion into net income. Boeing generates revenue from its four business segments: commercial aeroplanes, defence contracts, space and security, global services, and Boeing capital. However, the company faced significant setbacks, such as the worldwide grounding of its 737 Max planes and the COVID-19 pandemic that curbed air travel.
Boeing’s commercial aeroplane segment generated $4.73 billion in revenue in Q4 2020 and $16.2 billion for the whole year, comprising 28% of its total revenue. Its defence, space, and security segment provided $26.3 billion or 45% of its 2020 revenue. A large portion of this comes from the US Department of Defense, Boeing’s primary client.
Boeing’s global services segment provided $15.5 billion or 24% of its revenue in 2020. This segment offers various commercial, defence, and space customers solutions, including digital aviation and analytics, supply chain logistics, and training support.
Finally, Boeing Capital generated $261 million in 2020. This segment provides financial services, particularly asset-based leasing and lending services.
History of Boeing
In 1916, William Edward Boeing founded The Boeing Company in Seattle, Washington, after he and Conrad Westervelt created a single-engine, two-seat seaplane, the B&W. It was initially called Aero Products Company, but it was changed to Boeing Airplane Company within a month. The company’s main client was the US military, for which it manufactured military aircraft throughout the 1920s and 1930s.
In 1928, Boeing also expanded into selling aircraft for delivering mail and, by 1931, it consolidated its smaller airlines into a single large airline, which is now known as United Airlines. In the late 1950s, Boeing flew its 707 for the first time. This was a commercial success as the public was amazed at how they could travel from New York to Los Angeles in only a few hours.
A decade later, Boeing developed the 747, the long-range, wide-body cargo aircraft labelled as having democratised travel. This turned out to be the highest-selling commercial aircraft of all times, but it almost pushed the company into bankruptcy due to various production problems.
In 1995, Boeing created Sea Launch along with Russian, Ukrainian, and Anglo-Norweigian organisations. Sea Launch is a company that provides orbital launch services.
Boeing’s headquarters were moved from Seattle to Chicago in 2001. Two years later, the company started taking orders for the 787 Dreamliner, but it had many production problems, including the risk of battery fires. As a result, it was grounded by the U.S. Federal Aviation Administration for a short while. Still, 787 proved to be the aircraft that kicked off the new era of fuel-efficient aviation.
Boeing has seen its aircraft deliveries grow each year, except in 2019 and 2020, when both years combined for only 537 aircraft delivered. Its stock reached its peak point in March 2019 at $446.
And should I invest?
Before the pandemic, Boeing was a highly profitable company thanks to its main client, the US Government, and its booming commercial aeroplane business. The company is also doing its best to stay afloat financially, cutting down its workforce and cancelling its dividend payments. Let’s find out whether you should invest in Boeing stock.
Boeing Stock Investment Potential
Despite its two-year slide in 2019 and 2020, Boeing’s average annual growth rate over the last five years is still on the positive side at 13.03% and 11.39% over the previous ten years. In other words, the current market is only dominated by Boeing and Airbus, so any investor who considers this industry will have to bet on these two companies.
What Kinds of Investors Should Include Boeing in Their Portfolios?
Boeing might be a suitable investment option for investors who can bear uncertainty since the airline industry was harshly affected by the pandemic. Although there is sufficient evidence that Boeing has all it takes to recover, there might be numerous events that could stifle its efforts.
How Much Should I Invest in Boeing
When choosing the amount to invest in Boeing stock, you must consider two things: its investment growth potential and risk. Once you know that the stock price grows at a particular rate per year and carries a certain level of risk, it’s much easier for you to decide how much capital is comfortable for you to put on the line. These aspects will help you make the best choice regarding the exact amount of funds you should allocate to Boeing.
Buying, selling and trading shares for beginners
Generally, you can buy shares only through intermediaries known as brokers. Some companies also offer Direct Stock Purchase Plans, so you can make your investment without a brokerage firm. Let’s have a look at these methods and how they work.
Buy Boeing Shares Using a Broker
First, you should set up your trading account with a reputable broker. Brokers have online trading platforms where you can register by providing your information. It usually takes a few working days to review your application and approve it.
Then, you need to fund your account. Select your broker’s funding method that is most convenient for you. Most brokers accept a broad range of payment options, including electronic bank transfers that will show immediately in your trading account. Once the account is funded, you have the choice of using instantaneous market orders or setting limit orders to buy Boeing stock. You can also start investing in stocks and other assets provided by your chosen broker.
Buy Boeing Shares With a Direct Stock Purchase Plan (DSPP)
A Direct Stock Purchase Plan or DSPP is another way to buy Boeing shares through a transfer agent. The main advantage is that you will no longer incur a fee per transaction. You only need to put up the required initial investment amount and pay the setup fees. Then, you need to decide on the amount that will go directly to the purchase of Boeing shares.
However, if you take this route, you should know that you have to open a separate account for every company you want to add to your portfolio. This also means that you have less control over the initial investment, while setup fees can add up significantly.
Boeing offers something similar to a DSPP, and that’s a Dividend Reinvestment Plan (DRIP). DRIP allows investors to reinvest their dividend into additional shares. Still, you need to make your initial purchase through a broker.
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The entire world expects somewhat of a recovery from the pandemic this year, despite the virus hardly being contained. An investment in Boeing now could be an opportunity to capture the company’s stock price at a relatively lower price.
Boeing used to be a profitable business, but the worldwide grounding of its 737 Max planes after two fatal crashes caused it to lose money in 2019. In 2020, the company reported its largest net loss of $11.87 billion mostly due to pandemic travel limits.
An investment in Boeing is not only suitable on a long-term basis, but there is also enough daily volatility to make it suitable for active traders.
The best trading platform for trading Boeing stock should have a complete set of technical tools and guidance to ease the process. You should also consider commissions, fees, and other aspects related to the platform you choose.
Trading Boeing’s stock follows the standard market hours from 9:30 A.M. to 4 P.M. (ET), Monday to Friday.
Boeing is listed on the New York Stock Exchange (NYSE) under the symbol BA.
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