The Boeing Company (NYSE:BA) looks like a strong buy

The Boeing Company (NYSE:BA) looks like a strong buy

The Boeing Company (NYSE:BA) looks like a strong buy

Boeing announced near the end of February that Brazil-based Embraer SA shareholders approved their joint venture. The proposed deal, which has been in the works for some time now, will see Boeing pay roughly $4.2 billion for an 80% stake in Embraer’s commercial jetliner business. The Chicago-based firm will also take a 49% stake in a new joint venture on KC-390 military aircraft.

The move is projected to help Boeing better compete against European rival Airbus EADSY in the smaller aircraft market, with less than 150 seats. The Boeing and Embraer deal still faces regulatory approval, but is expected to officially close by the end of the year.

Boeing also recently partnered with Reno, Nevada-based Aerion to help push forward the next-generation of supersonic aircraft. BA is set to offer manufacturing, engineering, flight test resources, among other things, in order to bring Aerion’s AS2 supersonic business jet to market. The supersonic aircraft is designed to fly at speeds up to 1,000 miles per hour, or Mach 1.4—roughly 70% faster than current business jets. The AS2 is slated for its first flight in 2023 and is expected to save roughly three hours on transatlantic flights.

Price Movement

As we mentioned at the top, BA stock has soared to start the year, along with fellow Dow components like United Technologies Corp UTX, Caterpillar CAT, Cisco CSCO, and others. The recent climb has seen shares of Boeing hit multiple new highs in 2019. BA stock closed regular trading Tuesday at $430 a share, which marked a roughly 3% downturn from its 52-week high of $446 a share.

Meanwhile, the chart shows investors that Boeing has been able to stand out from its peer group, which includes General Dynamics GD, Lockheed Martin LMT, and Northrop Grumman NOC, in recent years.

Outlook & Earnings Trends

Looking ahead, Boeing projects that it will set a new commercial jet delivery record in 2019. The firm provided guidance between 895 to 905, which would blow past 2018’s previous record of 806. Boeing also said that its Dreamliner jets have remained in high demand from the likes of American Airlines AAL and United Airlines UAL.

Our current Zacks Consensus Estimate calls for Boeing’s Q1 2019 revenues to pop 8.3% to reach $25.32 billion. This would fall short of Q4’s 14% expansion, but investors should remember that Boeing soared well above our fourth-quarter estimate. Plus, BA’s second-quarter revenues are projected to jump 12.3% above the year-ago period. And Boeing’s full-year 2019 revenues are projected to surge roughly 10% to reach $111.16 billion.

Along with the company’s strong top-line projection, Boeing’s adjusted Q1 earnings are expected to surge 16.6% to reach $4.25 a share. The firm’s Q2 EPS figure is projected to skyrocket roughly 45%, with the full-year earnings expected to climb nearly 26%. Investors will also see that the company’s earnings estimate revisions picture has turned far more positive recently.

Overall, the bias in prices is: Upwards.

Note: this chart shows extraordinary price action to the upside.

By the way, prices are vulnerable to a correction towards 394.76.

The projected upper bound is: 453.44.

The projected lower bound is: 411.22.

The projected closing price is: 432.33.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 30 white candles and 20 black candles for a net of 10 white candles.

A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.

Three black candles occurred in the last three days. Although these candles were not big enough to create three black crows, the steady downward pattern is bearish.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 44.8397. This is not an overbought or oversold reading. The last signal was a sell 1 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 68.15. This is not a topping or bottoming area. However, the RSI just crossed below 70 from a topping formation. This is a bearish sign. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 0 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 46. This is not a topping or bottoming area. The last signal was a sell 1 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 1 period(s) ago.

Rex Takasugi – TD Profile

BOEING CO closed down -2.570 at 430.120. Volume was 30% below average (neutral) and Bollinger Bands were 25% narrower than normal.

Open High Low Close Volume___
431.040 433.820 428.730 430.120 700,371

Technical Outlook
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bullish

Moving Averages: 10-period 50-period 200-period
Close: 429.57 375.22 357.11
Volatility: 22 39 36
Volume: 794,602 979,317 863,882

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

BOEING CO is currently 20.4% above its 200-period moving average and is in an upward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. Our volume indicators reflect moderate flows of volume into BA.N (mildly bullish). Our trend forecasting oscillators are currently bullish on BA.N and have had this outlook for the last 39 periods. our momentum oscillator has set a new 14-period low while the security price has not. This is a bearish divergence.

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