Analysis And Valuation Of Boeing

| About: The Boeing (BA)

Being an investment analyst and portfolio manager, I am constantly on the lookout for companies that offer good investment opportunities. In this article, I take a look at Boeing (NYSE:BA), a commercial aircraft manufacturer that may offer investors upside potential that outweighs the risks.

We'll use the management effectiveness ratios, book value-share, price-sales, price-book value, etc., to evaluate Boeing.

Additionally, macro-economic indicators are provided at the end of the article. As part of investment analysis, analysts should consider both the company fundamentals and the macro-economic landscape. The macro-economic picture in the U.S. is deteriorating. In Europe, the economy is contracting.

Rating System

Buy - Be long

Neutral - No position

Sell - Be short

(The ratings, research and analysis in this article should be considered as starting point for further research.)

Boeing - Buy

Boeing (BA), the commercial aircraft manufacturer has a quick ratio of 0.42 and a gross margin of 18.2 percent. Earnings-share are forecasted to grow at 13.4 percent annually the next five years.

Shares of Boeing are trading near a recent peak while revenue-share and book value-share are increasing. Price-sales and price-book value are off of recent peaks.

Revenue from product sales increased compared to the year-ago quarter while revenue from service sales declined compared to the year-ago quarter.

In the first quarter of 2012 and 2011, the enterprise did not provide investors with high-quality earnings.

Second quarter 2012 revenue is forecasted to grow to US$17.5 billion, an increase of 5.9 percent over the year-ago quarter and a decline of almost 10 percent from the first quarter of the year. Revenue-share is forecasted to grow to 97.7.

Given the forecast for an increase in revenue-share, investors should accumulate shares of Boeing on dips as the downside to value is limited. Additionally, the long-term prospects of the firm remain excellent.

Macro Environment

ISM non-manufacturing PMI is declining; the index is expected to continue to decline in the coming months.

Non-farm employment change is declining; the pace of job growth is expected to continue to slow.

CB consumer confidence is increasing; the index is expected to decline in the coming months.

European Union flash manufacturing PMI is declining; the index is expected to increase in the coming months.

European Union flash services PMI is declining; the index is expected to increase in the coming months.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Disclaimer: This article is not meant to establish or continue an investment advisory relationship. Before investing, readers should consult their financial advisor. Christopher Grosvenor does not know your financial situation and ability to beae risk and thus his opinions may not be suitable for all investors.