This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Boeing a Teflon Stock

NEW YORK (TheStreet) -- Investor concern over fallout from the Boeing (BA) crash in San Francisco can rest easy. Early reports indicate pilot error as the most likely cause. According to reports, Lee Kang-Kuk, the pilot in charge, is one of the most junior pilots for South Korean airline Asiana.

The 777 is Boeing's first fly-by-wire using computer controls and has flown since United Continental Holdings (UAL) took the first delivery in 1995. Over 98% of the more than 1,000 777s continue in service. The 777s ranks as one of the safest aircraft models in service. Three of the top five safest jets you can fly are produced by Boeing.

The timing isn't the best for Boeing after the Dreamliner battery issues, but investors should consider Asiana-induced share weakness as temporary and not a catalyst to sell. After Boeing's successful navigation through the worry of Dreamliner delays, the company and its stock continue to soar higher.

Boeing has announced orders for the latest Dreamliner addition, the 787-10, and the company remains on schedule to arrive or exceed estimated profit targets. Boeing reports quarterly earnings on July 24.

Analysts expect a profit of $1.56 per share, an increase of 29 cents from the corresponding period last year. Boeing's one-year price target is $114.17 for an earnings multiple near 15.

BA Revenue Per Share TTM ChartBA Revenue Per Share TTM data by YCharts

Still, investors may wish to take some gains off the table. Boeing's shares have increased over 40% from this time last year and achieved a 52-week high recently. The weekly stock chart is quite extended, and shareholders should anticipate price consolidation in the near term.

An effective method of holding long-term positions while adjusting for short-term turbulence is through options. Selling covered calls decreases shareholder risk and volatility while allowing investors to receive quarterly dividends and avoid capital-gains taxes.

For example, by selling a September $105 strike call at $3.50, an investor is eligible for the next 48.5 cent dividend and reduces any unexpected drop in price by 3%.

If Boeing continues higher, and on expiration day the shares are trading above $105, simply buy the call option to close out the option trade and rollover to the next appropriate strike and expiration combination. Rinse and repeat, while collecting "rent" in the process. Or let the shares go if another superior investment opportunity presents itself.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,098.45 +18.88 0.11%
S&P 500 2,003.37 +6.63 0.33%
NASDAQ 4,580.2710 +22.5760 0.50%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs