Boeing (BA) could benefit from higher aircraft production, stronger free cash flow, upcoming certifications and improving defense results, RBC Capital Markets said in a note emailed Wednesday.
Boeing's better-than-expected Q2 free cash flow gives the company a stronger chance of reaching the upper end of its roughly $2 billion 2026 forecast, RBC said.
The investment firm expects Boeing to keep raising 737 MAX production, with output moving toward 47 aircraft per month and a later increase to 52 becoming more likely.
Certification of the MAX 7 and MAX 10 by the end of 2026 could support the stock, while further progress on the 777X could also improve investor confidence, RBC said, adding that Boeing's defense business is expected to become less risky over time as major programs advance, although the recent $280 million VC-25 charge was higher than expected.
RBC kept the company's outperform rating and lowered the price target to $265 from $275.
Price: $210.63, Change: $-10.94, Percent Change: -4.94%