The CEO of Boeing, which manufactures commercial jetliners as well as sells and services military aircraft and satellites, among other things, told investors at this week's annual meeting that the company is determined to cut the cost of producing those products.
Rather than take on expensive, gargantuan projects like the 787 Dreamliner, which CEO Jim McNerney characterized as "moon shots," he said he wants Boeing "to be more like Apple" with its carefully planned development strategies on successful product launches.
This willingness to learn from other industry leaders helps explain why Boeing's trailing 12-month (TTM) return on equity (ROE) is 41.6%! ROE helps both investors and analysts to better understand the profitability of a company by measuring how much profit a company generates with shareholders invested money. ROE is also defined as the amount of net income returned as a percentage of shareholders equity.
Boeing's stock performance has impressed analysts and pleased shareholders. As of the Thursday close of $132, shares are down 3.4% for the year to date. But as the following five-year chart illustrates, the stock has been a high-flyer since the 2009 lows.<
If you'd purchased shares of Boeing at the low in January 2009 of around $29.05, you'd be sitting on about a 454% profit today. Not including dividends, that's an average annual gain of nearly 91%. Not many analysts imagined how high BA would soar from its 2009 nadir.