Jim Cramer sees upside in Boeing after stock took hit on 737 Max issue


CNBC’s Jim Cramer suggested shopping for the dip in Boeing after shares traded decrease for 2 straight classes.

“Even with some short-term turbulence, Boeing’s perfectly positioned as the great reopening goes into full swing,” the “Mad Money” host mentioned Monday.

Dozens of 737 Max jets, manufactured by Boeing, have been temporarily grounded Friday to handle {an electrical} energy system issue in the plane. Boeing shares have declined 2% because the announcement, closing under $250 a share Monday.

Cramer, nonetheless, mentioned the circumstances don’t warrant dumping the stock as Boeing is at an inflection second.

“Boeing’s got too much going for its shareholders to get spooked by a bad headline,” he mentioned. “I regard that today’s decline on some negative sell-side research about corporate governance as a non-issue, too.”

Boeing’s 737 Max returned to service late final 12 months after it was grounded globally in the wake of two deadly crashes that killed lots of of individuals.

Air journey demand is rising as shoppers turn out to be much less fearful about contracting coronavirus. Meanwhile, airways are ordering extra planes, which could be financed at low-interest charges, Cramer mentioned. Southwest Airlines, for instance, introduced final month it was shopping for 100 units of the smallest Max model.

“This small issue aside, the 737 Max really is back. See, this used to be Boeing’s most popular plane and it got recertified right as the airlines were getting ready to start placing orders again in anticipation of the great reopening,” he mentioned.

“That’s why we own this one for the charitable trust and so far our thesis is playing out as expected.”

Despite promoting off over the previous 4 weeks, Boeing shares are up greater than 16% this 12 months. The stock is outperforming the S&P 500, which is up 10% 12 months to this point.

Disclosure: Cramer’s charitable belief owns shares of Boeing.

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