stock is bucking the market trend Wednesday, rising when other stocks are falling, the 737 MAX looks to be the reason why.
Boeing shares were up 1% as of 10:47 a.m. Wednesday, to $231.40 a share, rising from a daily low of $225.30. Shares closed Tuesday at $229.09. The
Dow Jones Industrial Average
are down 0.4% and 0.5%, respectively.
Shares turned around in Wednesday trading after reports indicating 737 MAX recertification flights have been scheduled in China. Boeing wasn’t immediately available to comment on the reports.
The MAX was grounded worldwide for about 21 months from March 2019 to December 2020 following two deadly crashes that killed hundreds inside of five months. The plane was recertified in the U.S. back in December. It is allowed to fly in most places Boeing sells planes, but China hasn’t recertified the jet yet.
The issue of Chinese recertification is important for the company and comes up on earnings conference calls. “We continue to work with global regulators and still anticipate that the remaining regulatory approvals will occur this year, including China,” said CEO David Calhoun on July 28. Still, the U.S. and Europe are the most significant markets for the MAX jet.
China has about 100 MAX jets grounded. Boeing has delivered about 520 MAX jets around the world to date. And of the roughly 4,000 unfilled MAX orders Boeing has on its books, 104 are destined for China.
Boeing stock is up about 7% year to date. Covid, the MAX and 787 quality issues are still overhangs for the stock. But as those issues start to resolve themselves, Boeing shares can rise.
The average analyst price target for Boeing stock is about $273, 18% higher than recent levels.
Write to Al Root at firstname.lastname@example.org