Boeing: A Strong Sell As Business Approaches Bubble Territory
It isn’t easy to invest in a low rate environment. While strong companies can often report impressive earnings and show solid growth in a weak economy, not all companies and industries benefit equally from a low rate environment.
Boeing has consistently been one of the best performing industrials over the last several years. Even though Companies on shorter-term business cycles such as Caterpillar (CAT) and engine maker Cummins (CMI), have seen these companies earnings fluctuate significantly, industrial companies on long-term contracts such as GE (GE) and Boeing (BA) have fairly consistently beat earnings estimates since 2010.
Boeing has outperformed most industrial stocks by a wide margin since 2010, and the company’s earnings have held up very well in the current weak economic environment.
Still, despite Boeing’s strong performance over the last several years, the stock has consistently underperformed most of the broader indexes by a wide margin over the last six months.