Boeing (NYSE:BA) shares fell nearly 2% intra-day today after Melius Research downgraded the company to Hold from Buy while keeping a $209 price target.
The downgrade is attributed to “too many overhangs” affecting the aircraft manufacturer. Melius Research pointed to strong demand for Boeing’s commercial planes but highlighted significant concerns, including execution issues, a slower-than-anticipated ramp-up in 737 production, and ongoing losses in the Boeing Defense sector. These factors contribute to skepticism about reaching the projected $10 billion in free cash flow (FCF) by 2026, a figure both Boeing and consensus estimates target.
The research firm suggests Boeing is on the path to, and in need of, an extensive multi-year restructuring. It also anticipates that the stream of negative news will persist, continuing to weigh on Boeing’s stock value. Melius Research’s FCF estimate for 2026 stands at $8.9 billion, falling $1.1 billion short of both consensus and Boeing’s own expectations.