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Boeing Stock Price On The Rise, 15 Pct Upside Potential

The share price of Boeing is  in momentum. InvestingHaven’s research team estimates that the upside potential of Boeing stock price is at least 15 percent.

Boeing, symbol BA, is a large cap with a market cap of approximately $100B. It has a healthy P/E ratio of 22x and a healthy annual growth of earnings per share.

Boeing’s stock price closed the week at $172.71, a 1.1% gain on the trading day and 3.7 gain on the week.

In technical terms: Boeing broke out recently after a 3-year consolidation period. That is meaningful because of its long consolidation period. The rule of thumb is: the longer the consolidation the stronger the next trend. BA could easily hit $200 in 2017 says InvestingHaven’s team, based on the chart pattern combined with stock market sector strength.

Interestingly, one would have expected airline stocks to perform well on declining crude oil prices (2015 and 2016) as oil is the most important input cost for an airliner. Nothing was further from the truth, and that is the reason why InvestingHaven‘s analysts always warn to be prudent interpreting market correlations. It is also another proof of the viewpoint that Primary Market Trends are much more important and valuable to investors than correlations or fundamental analysis. Read also How Strong Is The Stock Market Correlation To Oil Prices for more insights on crude to stock market correlations.

Boeing stock price on the rise within stock market sector in momentum

Investors always choose companies within a sector that is performing well and/or outperforming the broad stock market indexes. The U.S. airline industry, in which BA is operating, is visibly an outpeforming stock market sector.

In November last year, the U.S. airline index (DJUSAR) broke out from a long term consolidation trend. It had the form of a triangle as seen on below chart.

Right now, the airline industry is testing all-time highs. BA is already trading 15 percent above former all-time highs. That’s why it is a sector leader, and why it has upside potential provided that the airline industry does not correct significantly at this point.

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