Boeing (BA): fair value

Fair-value band

The normal range for this name runs from $131 (cheap) to $338 (expensive); it is now priced at $191.

That is 0.6σ below this name's own normal premium.

Is Boeing undervalued?

Fair, relative to its own history. Boeing trades at $191, 14% below the fair value this model estimates, but it has habitually traded 6% above fair value, and today's gap is 0.6σ below that norm, within the range it normally trades in, so the verdict is Fair: priced normally for itself, not necessarily fairly valued.

Diligence checklist

4 pass · 4 fail · 3 no data

• PASSCash actually collected from profit, last 12 months: 110%XBRL · Boeing gets $1.10 of real cash for every $1 of reported profit which means profits are real and not just numbers on paper. That's a good sign. 2 of the last 3 years were loss-making and can't be scored on this ratio at all: dividing cash flow by a loss says nothing about earnings quality.
• PASSGap between paper profit and real cash: -0.8%XBRL · Boeing's "profit on paper" and "cash in the bank" gap is small enough to pass.
• FAILDebt compared to one year of cash earnings: 5.08xXBRL (dealbreaker) · It would take 5.08 years of earnings to clear what Boeing owes, net of the cash it holds. Anything past four years is a dealbreaker for me: at this level a single bad year is a refinancing problem rather than a bad year, and no discount to fair value survives that.
• FAILHow much more it earns on capital than that capital costs: -2.78ppXBRL (dealbreaker) · Boeing earns 2.8 points LESS on the capital it employs than that capital costs. Every dollar reinvested here destroys value instead of creating it, which turns growth into a reason to worry rather than a reason to own the business. It has been below its cost of capital for 20 straight quarters, which is 5.0 years. That is capital destruction rather than a cheap stock, and it is where I stop work. The gap is wider than it was at the start of the window.
• PASSStock sold by executives and directors on the open market, last 6 months: $0.0MEDGAR · Nobody running Boeing sold a single share on the open market in the last 6 months. That is the alignment I want: the people with the most information about the business are keeping their money in it. Options being exercised, and shares held back to cover the tax on them, are not sales and I don't count them either.
• FAILHow long the CEO has run this company: 2.0 yearsTEXT · Boeing's chief executive took the job on September 20, 2024, 2.0 years ago. I want a full cycle at the company, which I take as 5 years, before a management record tells me anything: a short run has not yet been tested by a bad year. filing ↗
• FAILProfit margin held up during the last sales slump: -10.4% vs 9.6% baseXBRL · The last time Boeing's revenue fell, its profit margin per unit sold dropped from about 9.6% to -10.4%, giving up 209% of the margin it went in with. That looks like discounting to hold volume, which is the opposite of pricing power: a business customers won't leave doesn't have to pay them to stay. This is the accounts talking, not the filing: I'm reading the 3 quarters from September 2024 to March 2025, measured against the year going into it, and a shift in what the company sold can imitate pricing power either way.
• N/ANormal profit margin across a full business cycle: n/aXBRL · There is no valuation for Boeing, so there is no normal margin to test the current one against.
• N/AHow much of the stock trades on an average day: $1,778MMARKET · Boeing trades so much volume that this basically isn't a concern. There's no pass or fail here because the answer depends on how big a position I'd actually want to take.
• N/AShare of revenue from its single biggest customer: not establishedTEXT · I fetched and read Boeing's January 30, 2026 10-K but found no sentence about customer concentration. That isn't the same as the filing saying there is none: it may simply be worded in a way my search doesn't catch. Read Item 1 and the concentration-of-risk note yourself before trusting this row. filing ↗
• PASSWhether the company switched auditors in the last 2 years: noneEDGAR · Companies sometimes switch accounting auditors right before something bad is uncovered which can be a warning sign. Boeing hasn't changed auditors in the last 2 years, so there's no such red flag here.