Here’s why Citi sees a 14% upside for Boeing stock

Boeing (NYSE: BA) had a rough time in 2024. In fact, Boeing stock was the worst performer in the entire Dow Jones Industrial Index (DJIA) during the year, having lost 32.1% of its value.

There’s no shortage of what went wrong with the company last year. From catastrophic mid-air blowouts and whistleblower incidents to production delays and labor disputes, almost everything that could have gone wrong for Boeing did go wrong.

However, there is a silver lining in otherwise dark clouds — Wall Street analysts have slowly begun to adopt a more optimistic tone when discussing the aerospace giant. Back in early January, Barclays, Wolfe Research, and Deutsche Bank all reiterated prior ‘Buy’ or ‘Overweight’ ratings. All the firms in question revised their price targets upward.

By press time on February 10, BA stock was trading at a price of $183.58, marking a 3.71% increase on a year-to-date (YTD) basis.

That trio of bullish analysts has now become a quartet — as Citi has set a new price target for BA shares — one that sees a hefty 14% upside.

Citi believes one key division will drive Boeing stock gains

On February 10, Citi analyst Jason Gursky doubled down on a previously issued ‘Buy’ rating for Boeing stock. The researcher increased his price target from $207 to $210. If met, Gursky’s price target would represent a 14.39% upside from the current price of Boeing stock.

So, why did he make another upward revision? In a note shared with investors, Gursky expressed optimism regarding Boeing’s defense, space, and security (BDS) division. The researcher cited management’s expectation that BDS will return to high single-digit margins over the medium term, as hitherto-troubled programs stabilize, in spite of fears that the company’s contract mix will shift toward fixed-price.

Gursky reflected on the fact that BDS achieved record margins of 19.5% in Q4 2024. The aerospace business also expects to maintain mid-single-digit revenue growth, mid-teen margins, and a high cash flow conversion. The division continues to focus on ramping up 737 MAX and 787 production, and management anticipates that negative margins will unwind in 2026.

In addition, leadership expects to see free cash flow (FCF) improvement in 2025, as well as positive cash flow in the latter half of 2025. 

Despite the company’s last earnings call including its biggest-ever loss, analysts seem to have regained confidence that Boeing can recover in the long run. In the last quarter of 2024, BA stock also got a vote of confidence from Jim Cramer — and although he is known for his numerous missteps, the price of Boeing shares has indeed rallied since his recommendation.

Featured image via Shutterstock