NEW YORK (TheStreet) -- Shares of Boeing (BA - Get Report) are down -0.95% to $125.50 in pre-market trading as the aerospace company was downgraded to "neutral" from "buy" at Bank of America/Merrill Lynch (BAC) with a price target of $140, down from $154.
The firm's analysts said they see limited upside for the stock as the peak in the cycle looms over the industry, while downside is limited due to near-term visibility in earnings.
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- BA's revenue growth has slightly outpaced the industry average of 3.1%. Since the same quarter one year prior, revenues slightly increased by 8.3%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- Net operating cash flow has significantly increased by 112.21% to $1,112.00 million when compared to the same quarter last year. In addition, BOEING CO has also vastly surpassed the industry average cash flow growth rate of 43.40%.
- BOEING CO's earnings per share declined by 11.1% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, BOEING CO increased its bottom line by earning $5.97 versus $5.12 in the prior year. This year, the market expects an improvement in earnings ($7.70 versus $5.97).
- The debt-to-equity ratio is somewhat low, currently at 0.62, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.38 is very weak and demonstrates a lack of ability to pay short-term obligations.
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. When compared to other companies in the Aerospace & Defense industry and the overall market, BOEING CO's return on equity exceeds that of the industry average and significantly exceeds that of the S&P 500.
- You can view the full analysis from the report here: BA Ratings Report