Anyone Else Gambling on Boeing (BA)

[RetireBy90]

Is anyone else gambling on Boeing ? I picked up some at $366 average cost, thinking of selling when it gets back above $400. But seems to be running into one more issue every week or 2. Last I heard street thinks the 737MAX will be back in the air around end of the year, something like Oct or Nov. Anyone have more info on when they plan to return to flying ?

 

[Spock]

Having worked on FAA certified software, I would not expect the 737MAX to be returned to service this year. Just getting the approval will take longer than that and then the retrofit (installing the "optional" 2nd sensor) needs to be done on any plane that didn't order it from the factory.


The new (murky info) news of simulators found the CPUs not having enough capacity to handle the load, if true, is killer.


Airlines are just now starting to drop existing orders. It won't be long before Boeing is going to have to pay for all of the idle aircraft that airlines have parked.


Lastly(?) there is spill over to how the FAA neglected oversight on other aircraft... ex. the Dreamliner is going to spend time under the microscope. As well future aircraft plans.

Any aircraft manufacturer that can't remember to remove hammers and trash out of the plane during manufacturing has got a lot of cultural repair to do before they're trustworthy "again".



I don't think the bleeding is done yet.

 

[steelyman]

I see a report that the head of the 737 program is retiring. That could be headline news that moves the stock.

https://www.cnbc.com/2019/07/11/boe...o-retire-amid-crisis-over-jets-grounding.html

 

[Andre1969]

Not gambling, but I have an old 401k from when I used to work for McDonnell-Douglas/Boeing. It has mostly Boeing stock in it, but also a bit of a bond fund and an SP500 fund. When the stock started to tank earlier in the year, I moved some of it into the other two funds...around $370 per share, I think. I bought a little bit back when it was around $350 per share. It crept back up, but then fell back into the $350 range again, so I bought a bit more.

I don't do anything crazy, just a little rebalancing here and there. I was in the Boeing 401k program from late 1997 until I switched companies either at the end of 1999 or 2000. It's funny, I used to remember dates like that really well, but I guess the older you get, the less relevant that stuff is, and it slowly slips from the mind. Anyway, I picked up all that stock originally in the $30-50 range, more or less.


What I really miss was the old McDonnell-Douglas days. I remember their stock was around $20 per share when I started in 1992. I was just part time in those days, and wasn't eligible for the 401k, but they always showed the stock price on the pay stub. I also remember it doing a 3:1 split, and then a 2:1 split, and finally, when Boeing took over, a 1.3:1 split, and Boeing stock was around $57/sh at the time.

So, in 5 years, $20 would have gotten you about $445, about a 22x increase. But in the next 22 years, you "only" got about a 6.3x increase ($359 as of yesterday's close divided by $57). Still, nothing to sneeze at.

 

[brett]

I think that Boeing's problems have just started-financial, manufacturing, and regulatory.

 

[RetireBy90]

I did this once before, with Carnival. Bought when news of the crash in I think Spain then sold for couple hundred profit about a month later. Of course, time has shown this will be much longer to recover.

 

[6miths]

I was never able to convince myself that I had more information than the person on the other side of the trade. So no. I have a bunch of it in the index funds I own but long ago gave up on trading individual stocks.

 

[NW-Bound]

The problem with Boeing seems to go deeper than it first appeared to be. Boeing will survive, but it may take a while before you can count on it beating the market.

To buy low, how about something nobody talks much about anymore, like GE?

 

[Car-Guy]

To buy low, how about something nobody talks much about anymore, like GE?

Bought 10k shares yesterday at $10.12. Sold it a few minutes ago at $10.30. Buy and sell it about once a week. Not a lot of money but it adds up week after week, as long as I don't get caught holding to long on a big drop........ Now that's gambling, IMO

 

[NW-Bound]

$1800 a week is not bad. It does not make you rich, but buys grocery and pays utility bills.

And there's leftover for a trip or two.

 

[OldShooter]

$1800 a week is not bad. It does not make you rich, but buys grocery and pays utility bills.

Remember, the day traders who have recently lost money gambling with Boeing (or any other stock) are not boasting about their trades here. Nassim Taleb calls this "silent evidence." (https://johnaugust.com/2007/silent-evidence)

 

[NW-Bound]

It goes without saying that losers do not talk about it.

Taleb himself is not a buy-and-hold indexer, but stays in cash or treasuries, then trades options when he feels the odds are in his favor.

I have not heard about him recently. Wonder how he is doing.

 

[mamadogmamacat]

I worked in the industry for nearly 40 yrs, counting the jobs I had while getting my AE degree, but never for Boeing. I did know many Boeing employees well and dealt with them on joint military contracts. One needs to remember, however long the 737MAX saga takes to play out, that BA has its fingers in many pies, and still pretty much owns the large wide body market with its 787, which has only been selling widely, so to speak, for a few yrs now. Also, the commercial aircraft industry is cyclical in terms of sales, wherein airlines have to replace a significant portion of their fleets say every 7 to 10 yrs or so.

I first bought BA as an individual stock back in Jan 2013 at what I perceived to be more or less the beginning of such a cycle. The price was $74/sh. i bought more in Feb 2014 at $127/sh. Thinking we were near the end of the cycle and that BA would likely be relatively flat going fwd since it had risen so much, I sold out my stake, less accumulated dividends, on 2/5/2019 at $403/sh, as it happened just before the 737MAX issues began to affect the price. I am letting the rest ride. I do expect it will be a bit longer cycle now, say closer to the ten yrs so we have 3 or 4 more to go. An optimist will say BA can in that time get back to over 400., but it may not. I would not buy it now, nor would i sell, at least not until it gets a bump from both the 737MAX flying again, without any incidents one hopes or all bets are off, and we get a quarter or two of good overall sales, both commercial and military. Then I will sell either all or another portion of my holdings, depending on whether I guess that the cycle has more time in it or not.

 

[RetireBy90]

So looks like United has pulled 737 Max till November. I still need some 2% just to get even, so looking for a price above $400 would get me 10%. Not a great return for the risk.

 

[mamadogmamacat]

You may well still get your money back at least, but it may take longer than you would like to do so. I have never read any book he wrote, so only know what he allegedly says from internet sources, but i do agree with what has been dubbed the Buffet rule, "buy only what you know". So in this case, I would not now buy anything in the way of commercial aviation or military contractors, as due to both the run up such stocks have already had, the business cycle, and govt spending on defense, despite what one may hear in the media, being flat or only rising at most with inflation due to budget constraints and the fact that so many big contracts, such as F-35, new tanker, early spending on new bomber, etc are already in the pipeline, and priced in. Most news, like program delays/overruns, etc will be not good going forward in the short term. Now wait until mid 2020's if I live that long, and re-evaluate.


Of course, if one is day trading, and following tech analysis, not much caring what a stock is or what the co does, is a whole other ball game. i have yet to play in that sport.

 

[triangle]

Boeing is tempting but I have stayed away. I considered buying a few shares about 5-6 years ago after there was some production delays with a major aircraft (not sure if it was the 737 max or some other aircraft) but the stock price started climbing so fast soon thereafter that I hesitated to buy. Only to see it more that 3x higher even after the recent pullbacks, so a bad decision on my part.

I am slightly worried about the continuing headline risk regarding the 737 max. Will the public begin to view it as a flawed air frame design? Have the legal battles and TV circus around that played out yet? Putting pressure on airlines to stop buying and forcing BA to redesign? Then there is the Commercial Aircraft Corporation of China, aka Comac. I think they may take some market share from Boeing and Airbus, at least in Asia with their new aircraft. Hopefully they did not copy the 737 max too closely.

 

[Oz investor]

NO !
and am watching in trepidation as i have shares in Sydney Airport and Air New Zealand ( Air New Zealand is having issues with the 787 fleet ).

this could turn around or get even uglier ( for a lot of people , travel agencies , airlines , airports and aircraft leasing companies )

 

[BeachOrCity]

BA is not nearly discounted enough to compensate for the huge risk. Someone mentioned GE. I would do that long before BA.

 

[Chuckanut]

I just chatted with a friend who lives in Seattle. He told me he is now very happy that Boeing is an Chicago, Illinois based company.

 

[Bamaman]

We flew from Dublin to Boston on a 737 Max last year and were so thankful that we lived through it. We found that airplane to be very nice--for a one aisle plane.

We've flown the last 5 years to Europe on Norwegian Air's 787's. I understand theirs have the engines that airlines have been having problems with. Those planes are just so nice.

I just pray that the 737 Max fixes and additional flight training are promptly completed. Looks like Q-1, 2020 before those planes will be hitting the air. The 737 is the finest plane that's ever flown, and it's so important that the Max's are corrected to keep air travel as inexpensive as it presently is. We don't need one manufacturer (Airbus) without any competition in this most popular passenger configuration.

 

[6miths]

Yes on almost half of the flights I take. And I have not been reassured as more is disclosed regarding their handling of the 737 Max.

 

[Chuckanut]

I’ve read that the airlines aren’t making a big fuss over the MAX problems because the idea of just one plane manufacturer is to scary to contemplate.

 

[garya505]

We flew from Dublin to Boston on a 737 Max last year and were so thankful that we lived through it.

Wow, you were on one of the 41000 flights during the first year of service of the 737 Max that had no problems? You really dodged a bullet there!!!

 

[Souschef]

I’ve read that the airlines aren’t making a big fuss over the MAX problems because the idea of just one plane manufacturer is to scary to contemplate.

Airbus is stopping production of the A380 and concentrating on their other 2 engine planes

 

[samclem]

For those interested in a current, thorough, and evenhanded analysis of the 737 MAX issue, I highly recommend this NY Times Magazine article . It's a very good rundown of the reasons for/design of the 737 Max MCS system and the factors (technical, cultural, and training-related) for the 2 crashes that resulted in the grounding of the 737 Max fleet. Some good journalism, IMO.