FAA Approval to Lift 737 MAX Production Cap Might Change The Case For Investing In Boeing (BA)

• Last week, the Federal Aviation Administration approved increasing Boeing 737 MAX production to 42 jets per month, following intensive safety reviews after the Alaska Airlines door plug incident.
• This regulatory decision, together with substantial new Dreamliner orders from major airlines, signals renewed confidence in Boeing's manufacturing quality and operational recovery.
• We'll explore how the FAA's production cap lift and surging aircraft orders could influence Boeing's long-term growth and earnings outlook.

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Boeing Investment Narrative Recap

To be a Boeing shareholder today, you need conviction in the company’s ability to restore disciplined production and quality control as it increases output, given ongoing scrutiny of its 737 MAX program. The FAA’s decision to lift the production cap is a key short-term catalyst for Boeing, as it directly supports higher deliveries, but risk remains elevated due to unresolved certification hurdles for the 737-7 and 737-10, which could still impede earnings recovery if delays persist.

Among the latest announcements, Boeing’s successful completion of the first digital 8130-3 certificate shipment in partnership with Southwest Airlines stands out. This move supports both operational efficiency and supply chain integrity, factors that underpin Boeing’s recovery by minimizing risk of unapproved parts and reinforcing quality, which are central to regaining regulatory and customer confidence amid efforts to boost production.

But while rising output is promising, investors should be aware that operational risks linger, especially if...

Read the full narrative on Boeing (it's free!)

Boeing's outlook anticipates $114.4 billion in revenue and $7.1 billion in earnings by 2028. Achieving this would require a 14.9% annual revenue growth rate and an $18 billion earnings increase from the current loss of $-10.9 billion.

Uncover how Boeing's forecasts yield a $252.57 fair value, a 16% upside to its current price.

Exploring Other Perspectives

Seventeen Simply Wall St Community members estimate Boeing's fair value between US$206.79 and US$326.80. With the recent FAA production boost, the range highlights how future delivery rates and certification risks continue to divide opinion on Boeing’s outlook.

Explore 17 other fair value estimates on Boeing - why the stock might be worth as much as 50% more than the current price!

Build Your Own Boeing Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Boeing research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision.
• Our free Boeing research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Boeing's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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