Here's Why You Should Add Boeing (BA) To Your Portfolio

The Boeing Company (NYSE:BA) has been witnessing an upward estimate revision in the past 90 days, which reflects analysts’ optimism in the stock. The Zacks Consensus Estimate for earnings in 2019 moved up 4.53%.

Shares of Boeing have rallied 7.7% in the past 12 months against the industry’s decline of 4.0%.

Let’s focus on the factors that make Boeing an attractive stock to invest in.

Zacks Rank & Surprise History

The stock currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Boeing pulled off average positive earnings surprise of 28.01% in the last four quarters.

Growth Projections

The Zacks Consensus Estimate for earnings in 2019 is pegged at $18.22, reflecting a year-over-year increase of 21.06%. The Zacks Consensus Estimate for revenues in 2019 is pegged at $106.8 billion, reflecting a year-over-year increase of 7%. The company has an estimated long term earnings growth rate of 13.3%.

VGM Score

Boeing has a VGM Score of B. Here V stands for Value, G for Growth and M for Momentum, with the score being a weighted combination of all three factors. Back-tested results show that stocks with a VGM Score of A or B,
coupled with a bullish Zacks Rank, are best investment options.

Single-Aisle Jets to Drive Growth

Per Boeing's latest commercial market outlook (CMO), the company anticipates that the world will need 42,730 new planes worth $6.35 trillion between 2018 and 2037. Boeing expects single-aisle jets to continue to be the major driver behind demand growth, comprising 73.4% of the total projection. This translates into worldwide demand for 31,360 single-aisle jets worth $3.48 trillion in the next 20 years. To this end, the company continues to expect its 737 and 787 Dreamliners to remain major growth catalysts in the single-aisle jet market.

Strong Backlog Aids Prospects

Boeing’s backlog at the end of third-quarter 2018 increased to $491.2 billion from $488 billion registered at the end of the second quarter. The reported backlog included $28 billion of net orders during the quarter under review. Such strong backlog is certainly expected to boost future growth prospects of the company.

Stocks to Consider

A few other top-ranked companies in the same sector are AeroVironment, Inc. (NASDAQ:AVAV) , Northrop Grumman Corporation (NYSE:NOC) and Heico Corporation (NYSE:HEI) .

While AeroVironment and Northrop Grumman currently sport a Zacks Rank #1, Heico carries a Zacks Rank #2 (Buy).

Long-term earnings growth of AeroVironment, Northrop Grumman and Heico is pegged at 25%, 14.80% and 12.10%, respectively.

For 2019, The Zacks Consensus Estimate for earnings for AeroVironment, Northrop Grumman and Heico has moved up 33.3%, 0.7% and 4%, respectively, in the past 90 days.

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