Deutsche Bank downgraded Boeing Co to Hold from Buy, saying the stock’s valuation has caught up with its long-term recovery prospects and that “there’s a lot of wood to chop to get there.”
The bank lowered its price target to $240 from $255, citing weaker-than-expected free cash flow and slower progress in reducing debt. It now expects Boeing to generate $2.1 billion in free cash flow in 2026 and $6 billion in 2027, cuts of 56% and 40% from prior forecasts.
Analyst Scott Deuschle said the downgrade reflects “a constrained financial picture over the next few years” due to lower unit margins, higher advances headwinds, and increased capital spending.
He added that while Boeing’s 737 and 787 programs are improving, the benefits will take time to show up in cash flow and earnings.
Boeing’s latest quarterly results has highlighted those challenges as the plane maker delayed its 777X jet to 2027 and booked a $5 billion charge tied to production issues.
Deutsche Bank expects these setbacks, along with higher interest costs, to limit the company’s near-term upside even as travel demand and widebody production gradually recover.
Deuschle said Boeing remains well positioned competitively against Airbus but that investors may find better opportunities in its suppliers, which have stronger near-term earnings momentum.
Boeing shares have gained this year on expectations of a production ramp-up, but Deutsche Bank said those hopes are largely priced in.
“While we remain confident in Boeing’s leadership and its 2028 potential,” the analysts wrote, “the stock currently looks near fully valued, and there’s a lot of wood to chop to get there.”
