Boeing Co., the second-largest maker of jetliners, could see its stock post further gains due to a new chief executive officer and its first new plane in 10 years, according to Barron’s.
The aerospace giant’s shares have rallied since the departure of former CEO Phil Condit, who resigned under pressure late last year. Since the ascendance of new head Harry Stonecipher, the company has reversed its fortunes with a number of moves that have pleased Wall Street analysts, Barron’s said in its July 5 edition.
Stonecipher is also cutting costs across the company and doing away with plans to build a diversified finance arm — which would compete directly with General Electric, an important Boeing customer.
The article noted the impact on Boeing’s stock, which it said has jumped 30 percent from its December 2003 lows, outperforming its peers and the S&P 500 Index.
But Barron’s cited some risks to Boeing’s shares — which closed at $49.52 on Friday and is trading at 20 times consensus estimates of its 2005 earnings. The stock appears expensive by those measures, and the article said Boeing’s earnings could be undermined by annual spending on research and development.
