Boeing Reigns as DJIA’s Best Performer in 2017
For the first time in three weeks, Boeing Co. (BA) stock posted a week-over-week gain. Shares added about 0.3% last week and pushed Boeing's year-to-date share price gain to 51.45%, solidifying Boeing's hold as the best performing stock among the 30 stocks in the Dow Jones Industrial Average index.
All but eight Dow stocks have posted year-to-date gains, with the best — other than Boeing — being Apple Inc. (AAPL), up 35.99%; Visa Inc. (NYSE: V), up 31.39%; McDonald's Corp. (MCD), up 29.61%; and Caterpillar Inc. (CAT), up 22.84%. Last week's moves were small for all these companies.
Boeing's success may be attributed almost solely to cost control. In the second quarter, revenues were down 10% year over year, but costs were down by more than twice as much. The company has invested heavily in automation and trimmed its employee total by more than 2,000 workers.
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The result was operating cash flow of $4.95 billion in the second quarter, well above the $4.47 billion in cash flow in the same quarter a year ago, and a total of $7 billion for the first half of the year.
Boeing gives every sign of being able to continue its run at the top of the Dow class. Boeing raised its full-year adjusted earnings per share forecast by about 6% at the midpoint of a new range of $9.80 to $10.00 per share, and the company still expects to deliver 760 to 765 new commercial jets this year.
Operating cash flow guidance was raised from $10.75 billion to $12.25 billion, and Boeing cut its capex estimate by $300 million.
The uncertainty raised by the antics of the Trump administration last week kept investors cautious. When (if) the political situation in the country settles down, Boeing is in a good position to continue dominating the Dow.
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Boeing stock closed at $235.77 on Friday, up about 0.1% for the day, in a 52-week range of $126.31 to $246.49. The 12-month consensus price target is $252.20, and the highest target is set at $302.00.
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