Boeing has been in a downward trend for a year due to the grounding of the 737 Max. What has impressed me about the resilience of the stock price, is the peak-to-trough decline has thus far only been about 25%. Last year, several times I successfully traded Options against it and outright bought the stock in November 2019. The price hasn’t yet recovered but long term I think Boeing in an excellent opportunity.
In my estimation, Boeing is just too big to fail.
- US largest manufacturer
- US largest exporter
- Primary beneficiary of the US Import-Export Bank
- Tariffs on Airbus have just been raised to 15%
- Pending ban on sales of GE aircraft engines for China’s new passenger jet
Dominant US corporations rarely fail. As an example, General Motors has a long history of favorable treatment, its routs last about a year or so. Buying below a long term moving average almost always pays off. I think this will also be the case with Boeing.
But don’t bet the ranch on it. A portfolio should be designed with diversification and a long term horizon.