Few companies that trade publicly are recession proof. Even fewer
companies you can buy and not look at for years. One of these few companies is
Boeing (NYSE: BA). Boeing makes large
and enormous commercial jetliners and also makes military grade jets as
well. They have orders for the next 100
years in their backlog. They cannot
produce planes fast enough to meet the demand.
Today, Boeing reported their
quarterly numbers and destroyed them.
They actually said they would have been much better if their 787 ‘s were
being produced faster. Looking at the
current valuation of Boeing, we see a market capitalization of just under $70
Billion. There is no reason why this cannot
be above $100 Billion. Seeing this kind
of room in a market cap for a large entity such as Boeing is something that I
look for when investing. The more room
you think the company has to grow, the greater opportunity it is.
For example, when Apple was above
$700 a share, there market cap was getting close to $700 Billion. Being that Exxon was about $300 Billion
behind Apple, I had some reservations about buying the stock at those lofty
levels (even with a $1,000 price target on it).
It’s not hard to buy a great
company. But even a great company can be
overvalued and not attractive at their current price, but at a lower one.
In the case of Boeing, I feel that it
still heavily under valued and will go well beyond $100 a share (currently
trading close to $91).
