Stock extends months-long losing streak after reported FAA probe into whistleblower complaint follows a decline in aircraft deliveries
Shares of Boeing Co. kept falling toward the lowest levels seen in more than a year on Wednesday, as the aerospace giant continued to feel the heat from allegations of shoddy safety controls.
“Just when you thought things couldn’t get any worst at Boeing, they have,” is how Vertical Research Partners analyst Robert Stallard put it.
The stock BA, -2.20% slumped 2.4% in afternoon trading. It has tumbled 9.9% amid an eight-session losing streak, which would be the longest such streak since the nine-day stretch that ended Sept. 13, 2023.
That put the stock on track to close at the lowest price since November 2022.
The continued selloff comes after reports surfaced late Tuesday that the Federal Aviation Administration was investigating claims made by a Boeing whistleblower who said the company was taking assembly and safety shortcuts with 787 aircraft.
Senator Richard Blumenthal (D-CT), chairman of the U.S. Senate Permanent Subcommittee on Investigations, said late Tuesday that the allegations are being examined, and requested that outgoing Chief Executive Dave Calhoun appear at a hearing scheduled for April 17.
Also on Tuesday, Boeing reported the fewest quarterly aircraft deliveries in nearly three years, and well below what Wall Street was expecting.
Stifel Nicolaus analyst Bert Subin said that while he expects the deliveries story to improve this year, as the problem is more about production issues than a lack of demand. However, the data doesn’t change the negative outlook for free cash flow, and “likely presents a tough upside case.”
Subin reiterated his buy rating on the stock, but he trimmed his price target to $260 from $270. Still, the new price target implies about 50% upside to current levels.
Boeing’s stock has tumbled 33.3% year to date, enough to make it the S&P 500 index’s SPX worst performer this year. The S&P 500 has gained 8.1% year to date.