Boeing Slips 3.2% in 3 Months: Is a Better Entry Point Ahead?

The Boeing Company’s BA shares have lost 3.2% over the past three months compared with the Zacks Aerospace-Defense industry’s decline of 3.8%. Boeing remains one of the largest U.S. commercial aircraft manufacturers. Steadily growing commercial air travel should boost Boeing’s service business unit. The outlook for Boeing’s defense and space business segment also remains optimistic.
 

Image Source: Zacks Investment Research

Shares of other defense stocks, such as Northrop Grumman NOC and Lockheed Martin LMT, have shown mixed performance over the same time frame. Shares of Northrop Grumman have lost 3.1% while those of Lockheed Martin have risen 2.7%. Northrop Grumman benefits from a record backlog, rising defense spending and expanding demand for strategic deterrence, missile defense, space and advanced aircraft. Lockheed Martin’s record backlog, expanding munitions capacity and alignment with U.S. and allied defense priorities support durable growth. 

Considering Boeing’s current price decline, investors may be wondering whether now is a good time to add the stock to their portfolios. Let’s examine the factors and assess the company’s investment prospects to make a more informed decision.

Factors Acting in Favor of BA Stock

The outlook for the aerospace giant’s defense and space business also remains encouraging, as Boeing is one of the largest defense contractors globally and a prominent integrator for the International Space Station.

Thanks to its diverse defense product portfolio and established footprint in the space technology industry, Boeing witnesses a solid inflow of contracts. In the second quarter of 2026, Boeing’s Defense, Space & Security (“BDS”) revenues increased 13% year over year to $7.48 billion, driven by higher volumes across classified programs, missiles and weapons, and KC-46A activity. The segment booked $7 billion of orders and ended the quarter with an $85 billion backlog, with 27% tied to customers outside the United States.

Recently, Boeing completed the sale of its 50% stake in HRL Laboratories (which was a 50/50 joint venture between Boeing and GM) to IBM. The completion benefits Boeing by allowing the company to focus capital and management resources on its core aerospace, defense and space businesses, rather than allocating resources to an advanced-technology joint venture outside its primary operations.

Boeing’s new seven-year framework agreements for the Standard Missile-3 (SM-3) provide a positive growth opportunity for the BDS segment by giving the company greater visibility into long-term demand for critical missile-defense components. Under the agreements, Boeing will increase production of avionics and ejector assemblies used in the SM-3 Block IB and IIA interceptors, which are key part of U.S. and allied sea-based missile defense.

Key Headwinds Facing BA Stock

The order book is growing, but slow production, delayed deliveries and ongoing inspections could be turning customers away from Boeing’s commercial airplanes, leading to recent order cancellations. Aircraft order cancellations during the six months ended June 30, 2026, totaled $2.78 billion and were primarily related to 737 aircraft. The 777X program has suffered repeated postponements and significant cost overruns. 

The Boeing 777X program is running seven years late, with an expected entry-into-service date in 2027. These delays, caused by rigorous FAA scrutiny, design changes and part cracks, have resulted in significant cost overruns. The ongoing trade tensions between the United States and China pose another challenge. Any escalation in trade disputes could delay these deliveries, hurting revenues and increasing inventory costs.

Estimates for BA Stock

The Zacks Consensus Estimate for Boeing’s 2026 earnings per share (EPS) indicates a year-over-year improvement of 91.82%.
 

Image Source: Zacks Investment Research

The consensus estimate for Northrop Grumman’s 2026 EPS calls for year-over-year growth of 9.45%. The Zacks Consensus Estimate for Lockheed Martin’s 2026 EPS implies a year-over-year rise of 31.44%.

BA’s Earnings Surprise History

The company beat on earnings in one of the trailing four quarters and missed in the other three, delivering an average negative surprise of 113.46%.

Image Source: Zacks Investment Research

BA Stock’s Liquidity

The company’s current ratio is 1.14 compared with the industry’s average of 1.10. A ratio of more than one suggests a healthy liquidity position, where the business can meet its immediate financial obligations without selling long-term assets.

Image Source: Zacks Investment Research

BA Stock Trades at a Discount

In terms of valuation, Boeing’s forward 12-month price-to-sales (P/S) is 1.55X, a discount to the industry’s average of 2.36X. This suggests that investors will be paying a lower price than the company's expected sales growth compared with that of its peer group.

Image Source: Zacks Investment Research

What Should Be the Next Move?

Boeing’s BDS business remains well positioned for growth, supported by a diversified defense portfolio, strong contract activity and an established presence in space technology. Recent strategic actions further strengthen its focus on core defense programs and provide greater long-term revenue visibility.

Considering current execution challenges, new investors should wait and look for a better entry point. Investors who already own this Zacks Rank #3 (Hold) stock may consider retaining it, given the company’s strong earnings growth and solid liquidity. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Research Chief Names "Single Best Pick to Double"

From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.

This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.

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 report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research