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J.P.Morgan restores buy call on Boeing after 1-1/2 years

J.P.Morgan restores buy call on Boeing after 1-1/2 years
J.P.Morgan restores buy call on Boeing after 1-1/2 years   -   Copyright  Thomson Reuters 2021   -  
By Reuters

<div> <p> – J.P.Morgan analysts have turned bullish on Boeing Co shares on the likelihood that China will soon allow the U.S. planemaker’s 737 <span class="caps">MAX</span> jet to return to its skies following a global grounding. </p> <p>The brokerage gave an “outperform” rating to the stock on Thursday, saying the U.S. planemaker can ramp up global deliveries of the <span class="caps">MAX</span> jet to 52 per month in 2024, a rate which could eliminate Boeing’s inventory of excess 737s by 2025. </p> <p>It had downgraded the stock by a notch in March 2020, just when the pandemic had started to extract a huge toll on the airline industry. Boeing’s 737 <span class="caps">MAX</span> had already been grounded for a year by then, following two deadly air crashes.</p> <p>Earlier this week, China’s aviation regulator agreed that design changes Boeing proposed for its 737 <span class="caps">MAX</span> plane could resolve safety problems.</p> <p>“<span class="caps">MAX</span> certification is just one element of Boeing’s China exposure, with another being future orders,” said J.P.Morgan’s Seth Seifman, a four-star rated analyst by Refinitiv for his estimate accuracy.</p> <p>Seifman estimates 445 deliveries of 737 <span class="caps">MAX</span> aircrafts in 2022, or 37 planes per month, compared with an average delivery of about 20 planes each in the last four months.</p> <p>The analyst also raised his price target on Boeing to $275 from $260, indicating a 21.3% upside to the stock’s Wednesday close. </p> <p>“Boeing’s position at the center of global air travel offers confidence that it will recover financially over time and we believe risk-reward now skews favorably,” Seifman said.</p> <p/> </div>