Have you been paying attention to shares of The Boeing CompanyBA ? Shares have been on the move with the stock up 7.9% over the past month. BA hit a new 52-week high of $371.60 in the previous session. The Boeing has gained 26% since the start of the year compared to the 11.9% move for the Aerospace sector and the 13.2% year-to-date return for its peer group.
What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, having beaten the Zacks Consensus Estimate in each of the last four quarters. In its last earnings report on April 25, 2018, Boeing reported EPS of $3.64 versus the Zacks Consensus Estimate of $2.59 while it beat the consensus revenue estimate by 4.76%.
For the current fiscal year, Boeing is expected to post earnings of $14.66 per share on $98.2 billion in revenues. This represents a 21.84% change in EPS on a 5.15% change in revenues. For the next fiscal year, the company is expected to earn $16.97 per share on $104.16 billion in revenues. This represents a year-over-year change of 15.71% and 6.06%, respectively.
Boeing may be at a 52-week high right now, but what might the future hold for BA? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
Boeing has a Value Score of C. The stock's Growth and Momentum Scores are A and D, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 25.3X current fiscal year EPS estimates. On a trailing cash flow basis, the stock currently trades at 23.5X versus its peer group's average of 15.7X. Additionally, the stock has a PEG ratio of 1.84. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
The Boeing Company Price and Consensus
The Boeing Company Price and Consensus | The Boeing Company Quote
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, Boeing currently has a Zacks Rank of #2 (Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 and Style Scores of A or B, it looks as if The Boeing passes the test. Thus, it seems as though BA shares could have potential in the weeks and months to come.
How Does Boeing Stack Up to the Competition?
Shares of Boeing have been rising, and the company still appears to be a decent choice, but what about the rest of the industry? Some of its industry peers are also impressive, including Wesco Aircraft Holdings WAIR , KLX KLXI , and Moog MOG.A , all of which currently have a Zacks Rank of at least #2 and a VGM Score of at least B, making them well-rounded choices.
However, it is worth noting that the Zacks Industry Rank for this group is in the bottom half of the ranking, so it isn't all good news for Boeing. Still, the fundamentals for BA are promising, and it still has potential despite being at a 52-week high.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free reportThe Boeing Company (BA): Free Stock Analysis ReportWesco Aircraft Holdings, Inc. (WAIR): Free Stock Analysis ReportMoog Inc. (MOG.A): Free Stock Analysis ReportKLX Inc. (KLXI): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research