BA – Market expectations are for Uniform ROA to rebound, but management may have concerns about air traffic, commercial airlines, and the 787

• The Boeing Company (BA:USA) currently trades above historical averages relative to UAFRS-based (Uniform) earnings, with a 36.8x Uniform P/E. At these levels, the market is pricing in bullish expectations for the firm, but management may have concerns about air passenger traffic, commercial airline weakness, and 787 issues
  
• Specifically, management may have concerns about the pandemic’s impact on commercial customers and suppliers, negative aircraft purchasing trends, and continued weakness in global passenger traffic. Furthermore, they may lack confidence in their ability to provide digital solutions to customers, reduce facility and site costs, and win more Defense, Space, and Security (BDS) segment contracts. Moreover, management may be concerned about 787 quality issues, the impact of layoffs on their commitments to customers, and the performance of the commercial business. Finally, they may be exaggerating the progress of their enhanced enterprise safety management system and their ability to compete in China