Boeing Bull Bear Case

2014 Bull/Bear Case Bull Bear EPS $7.5 $6.5 P/E 20х 16x Target Price $163 $104 Bull case assumes a P/E of 20x for the pre-recession level five-year Our bear case assumes that austerity measures in the US and Europe will cause a average.Earnings estimates of reduction in defense segment sales and cancellation of company, its $7.5 are based on mean consensus. current orders. We considered record 7 year backlog for Boeing's 737 and which leads to grounding of a 3.5 year backlog for its wide body planes. as well as production capacity and manufacturing efficiencies Rising fuel costs and increasing traffic is also creating a need for more fuel efficient planes. Further 787 incidents occur planes, metal prices start increasing leading to lower margins on fixed price contracts IATA's forecasts for global airlines profitability this year and continued growth - albeit at a slightly slower pace - in emerging markets should increase traffic for airlines specifically state owned enterprises out of the Middle East. We also assumed that the defense segment will undergo relative volume reduction. However most major will development programs remain intact as DoD implements its budget cuts for the current government fiscal year 2014. SOURCES: Company Data, SEC filings, Bloomberg Professional Services BIDNESS Etc. DISCLAIMER: Bidness Etc(TM) and related marks are owned by Bidness Etc. Any other trademarks appearing on this website are the property of their respective owners, and are not used to indicate the origin of goods or services offered or provided by Bidness Etc herein or to suggest approval for or affiliation with Bidness Etc. Assumptions Bear Case Bull Case Assumptions