By Sam Boughedda
Investing.com — Boeing Co (NYSE:BA) shares have been upgraded for the second time in a week after JPMorgan analyst Seth Seifman raised them to overweight from neutral based on a "fairly defined catalyst path."
In a research note, the analyst told investors that the first "critical" catalyst is China's MAX certification, which should happen soon. But, unwittingly for Seifman, it may come even sooner than he expected — a few hours after the JPMorgan note, Chinese media company Caixin Global reported that the Chinese regulator is satisfied with Boeing's proposed 737 Max fixes.
Boeing shares hit a high of $231.50 earlier in the day, but closed up just 0.26% at $227.20.
The second catalyst for Seifman is the 787 delivery halt, which is likely to extend into 2022.
"Beyond these two items, there are things Boeing can do in the coming quarters to give confidence to investors, such as reliably delivering more 737s (and eventually 787s) than it produces, winning aircraft orders, and generating cash. We expect these things to occur, but some have been pushed out, so we do not take them for granted," Seifman explained.
The analyst, who also raised Boeing's price target to $275 per share from the prior $260, said there is a tendency to expect big jumps in BA, given the current catalysts, but there is tough work ahead for the company.
"Boeing’s position at the center of global air travel offers confidence that it will recover financially over time and we believe risk-reward now skews favorably,” Seifman concluded.