From Nasdaq: 2024-06-24 00:05:47

Boeing is currently a better pick over Airbus due to its more attractive valuation. Airbus trades at a higher valuation of 1.9x trailing revenues, while Boeing is at 1.4x. Boeing’s stock has fallen 30% this year due to ongoing issues with the 737 MAX, while Airbus stock has risen 3%.

Boeing faced setbacks with its 737 MAX aircraft, including issues with cabin side panels and fuselages, leading to delays in deliveries and increased scrutiny from the FAA. The company plans to acquire supplier Spirit AeroSystems to address quality concerns. CEO Dave Calhoun will step down, with GE Aerospace’s Larry Culp declining the offer to head Boeing.

While Boeing’s stock has declined by 20% this year, Airbus has seen strong gains of 60%. Both companies have underperformed the S&P 500 in recent years. However, Airbus is more profitable and has a better financial position compared to Boeing. The demand for new aircraft remains high amidst global travel growth.

Airbus has shown similar revenue growth to Boeing but is more profitable. Boeing has reported losses since 2019, while Airbus has shown improvement in operating margin and profitability. Airbus also has a stronger financial position with less debt and more cash compared to Boeing. Despite ongoing challenges, demand for new aircraft is expected to remain high.

While both Boeing and Airbus face challenges, long-term investors may benefit from investing in Boeing during the current dip. Boeing’s ongoing issues are seen as transient, and the company is taking steps to improve quality and production. Despite the setbacks, both companies have a strong backlog of orders, indicating continued demand for aircraft in the future.



Read more at Nasdaq: Has The 737 MAX Clipped Boeing’s Wings? Is Airbus A Better Pick?