Boeing Stock: Why Investors Should Think Twice Before Buying

NEW YORK, NY — Boeing Co.’s stock price plummeted 7% on March 4, 2025, amid growing concerns over the impact of new trade tariffs. With a heavy reliance on imported components, the manufacturer is particularly vulnerable to trade disruptions, leading to potential increases in costs and a decrease in production efficiency.

The recent volatility in the market has been largely attributed to the tariff policies instigated by the Trump administration, which have raised alarms about inflationary pressures across the broader economic landscape. Analysts warn that these trade barriers could fundamentally reshape investor sentiment and economic dynamics, affecting stocks like Boeing (NYSE: BA).

At its current trading level of approximately $160, BA appears unattractive as an investment. Several key concerns about the stock have led analysts to deem it a poor choice for buyers at this time. A comparative analysis reveals that BA’s valuation doesn’t align with its operating performance, which has been below expectations in recent years.

Key performance metrics reveal troubling trends. Boeing’s growth rate over the last three years is an average of 3.1%, significantly lagging behind the S&P 500’s 9.8%. Furthermore, the company’s revenues have decreased 14%, from $78 billion to $67 billion, compared to a growth rate of 5.6% for the S&P 500 over the same period. This downward trend is stark, as seen in the most recent quarterly report where revenues fell 31%, from $22 billion to $15 billion year-over-year.

Profitability metrics also tell a concerning story. Boeing’s operating margin stands at -16.3% for the last four quarters compared to the S&P 500’s positive 12.6%. Over the same timeframe, the firm’s cash flow from operations was reported at -$12.1 billion, yielding an operating cash flow-to-sales ratio of -18.2%, while the S&P 500 boasts a positive 14.4% ratio.

Boeing’s financial stability appears weak as well. The company disclosed a debt figure of $54 billion at the end of the most recent quarter, with a market capitalization of $117 billion, resulting in a debt-to-equity ratio of 46.2%. This is significantly higher than the S&P 500’s preferable figure of 19.7%. Additionally, cash and cash equivalents total $26 billion out of $156 billion in total assets, providing a cash-to-assets ratio of only 7.6% versus the 14.1% seen in the S&P 500.

Market performance shows that BA stock has lagged behind the S&P 500 during recent downturns. For instance, from a peak of $225.96 on January 17, 2022, to $115.86 on June 13, 2022, BA stock declined by 48.7%, while the S&P 500 saw a peak-to-trough decline of only 25.4%. Although it briefly rebounded, reaching a high of $264.27 on December 17, 2023, the stock maintains a precarious position around $160.

The historical volatility of BA is notable as well. The stock fell 71.9% from its high of $338.30 in February 2020 to a low of $95.01 a month later. Despite recovering to pre-crisis levels by mid-2023, it has not yet returned to its previous high, showing persistent instability.

In conclusion, Boeing’s performance metrics indicate serious challenges across growth, profitability, and financial stability. Current valuation levels do not accurately reflect these struggles, leading experts to recommend against purchasing BA stock at this time. Investors looking for greater market exposure with less volatility might consider alternatives such as investment portfolios that have outperformed the S&P 500 and yielded superior returns.