Boeing (BA 0.73%) may be the world's best-known manufacturer of commercial jetliners, but it's no longer the biggest. A spate of design problems with a couple of its newest aircraft has raised lingering questions since the first of them materialized in 2018, allowing rival Airbus to take the lead.
Then the COVID-19 pandemic took hold in early 2020, effectively shutting down the world's travel industry. The business sector has since technically bounced back in terms of total passenger trips. Yet, somehow, it's more anemic than before. Numbers from the International Air Transport Association (IATA) indicate that this year's global air travel revenue will still be less than 2015's collective top line, with profit margin rates also holding below pre-pandemic levels. The industry is struggling. In this vein, Boeing itself remains in the red.
This begs the question: How much of a toll has all this taken on Boeing stock?
Answer: A lot.
Image source: Getty Images.
The chart below says it all. Boeing shares are trading below where they were two years ago -- and even below where they were five years ago -- despite the broad market's substantial gains during this stretch. Indeed, Boeing's share price is still more than 50% below its early 2019 peak, with most of that loss occurring at the onset of the coronavirus pandemic. Airlines aren't exactly lining up to (1) buy aircraft they may or may not be able to afford, and (2) buy aircraft that may or may not be as airworthy as alternatives.
NYSE: BA
Key Data Points
Still, in the grand scheme of things, this doesn't mean Boeing is doomed, or that Boeing stock itself is un-ownable. Companies can and do struggle for years on end, without their investment thesis actually changing. That's particularly true with economically sensitive industries like passenger aircraft, which have very long-term sales and development cycles.
This might help: Despite all of its current challenges, Boeing's backlog of unfilled plane orders grew to a record-breaking $636 billion as of the third quarter of this year. This ever-growing number ultimately reflects Boeing's projection that the world's airlines will need to take delivery of a total of 43,600 new passenger jets between now and 2044. For perspective, the IATA reports that 30,300 jetliners are in regular use right now, with another 5,250 in storage. That's promising, to be sure, as is the analysts' consensus price target of $248.71 -- that's more than 30% above this ticker's present price.
Still, there's no denying that Boeing's stock is testing shareholders' patience here.
