Morgan Stanley Upgrades Boeing On Being 'Ready For Takeoff'

While Boeing Co’s BA production rates and the consensus estimates have been lowered, there are no significant incremental headwinds for the company in 2021, according to Morgan Stanley.

The Boeing Analyst: Kristine Liwag upgraded Boeing's stock from Underweight to Overweight, while raising the price target from $165 to $230.

The Boeing Thesis: The company is “a COVID-19 recovery play with upside,” Liwag said in the note.

Boeing Commercial Airplanes (BCA) has written down around 10% of its backlog, reduced production rates for its 737 MAX and 787, and delayed the 777X, he mentioned.

“With a low bar for expectations, and without any significant incremental headwinds in 2021, we now see a clear runway for Boeing for further upside,” the analyst wrote.

“COVID-19 vaccine rollout through 2021, eventual easing of international borders, and improved airline booking trends are positive catalysts that could influence bears and sideliners to re-evaluate the bull thesis,” he added.

BA Price Action: Shares of Boeing traded lower by 1.9% to $193.39 at the time of publication Friday. The stock earlier hit an intraday high of $201.45.

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