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Boeing stock: These are 4 major catalysts to watch

Published 24-06-2024, 07:08 pm
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A Reuters report on Sunday night stated that U.S. prosecutors are recommending Boeing Co (NYSE:BA) be criminally charged for violating a 2021 deferred prosecution agreement related to two fatal crashes.

The report comes as somewhat contradicting a Friday article by the New York Times claiming the Department of Justice (DOJ) would not pursue criminal charges.

Reuters noted that a final decision has not been made, and the DOJ might instead extend the 2021 agreement and impose stricter requirements. A decision is expected by July 7.

Meanwhile, separate reports suggest Boeing is close to finalizing a deal to acquire Spirit AeroSystems (NYSE: NYSE:SPR), potentially announcing it this week to strengthen its supply chain control.

In addition, the planemaker is also actively searching for a new Chief Executive Officer, though a recent Wall Street Journal article indicated the process is slower than anticipated.

Although these three factors – the DOJ decision, the Spirit deal, and the CEO search – are important, perhaps the most significant event for the stock in the near term will be ramping output of the 737 MAX, market commentary Vital Knowledge said in a note.

“The FAA has imposed a production ceiling of 38 planes per month, but the company is building at a pace far below this level – Boeing’s CFO back at the Wolfe conf. in late May said the hope was to accelerate output toward 38 planes per month in H2, with “material progress” by the end of June,” it wrote.

“Whether such progress has been achieved will be one of the key wildcards for the Q2 earnings report next month,” Vital Knowledge added.

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