Know What's Happening in Business

The Boeing Company (BA): Our Calculation of Intrinsic Value

Each week we run a DCF model on Boeing, arriving at an intrinsic share price of roughly $85, far below the current market level near $230. The analysis uses a 10% discount rate, 2.5% terminal growth, and forecasts free cash flow rising to $8.5 billion by 2029, producing a $92.1 billion enterprise value. After subtracting about $25 billion of net debt, equity value translates to $85 per share, implying a 63% negative margin of safety. The market appears to be pricing in an optimistic recovery scenario.