Boeing’s Labor Strike Enters Week 5: How Bad Could This Get?
If you own Boeing (NYSE: BA) stock, you’ve probably been closely following the news of the protracted labor strike by Boeing’s machinists union, now entering its fifth week.
After two days of renewed talks with union negotiators from the International Association of Machinists (IAM) that went nowhere, Boeing made the decision to cut off negotiations entirely. In response, IAM complained that Boeing refused to improve wages, retirement plans, and vacation or sick leave.
The ongoing strike is causing significant financial strain on Boeing, with estimates of losses ranging from $1 billion per week to $1 billion per month. Boeing is losing money despite its struggles even before the pandemic, with nearly $58 billion in debt on its balance sheet.
Boeing’s survival through this strike is crucial, and the company has options to consider. Wells Fargo predicted that Boeing might attempt to raise $10 billion to $15 billion by selling stock to cover losses from the strike. While this action could impact Boeing’s credit rating, it is a viable option for the company in the face of financial challenges.
Although the situation is concerning, it’s essential to highlight that Boeing has weathered significant financial difficulties in the past and navigated through them successfully. The company has taken out loans and issued new stock to overcome challenges, indicating its ability to adapt to adverse circumstances.
Despite the current situation, investing in Boeing might not be the best move according to the Motley Fool Stock Advisor analyst team. They have identified what they believe are the 10 best stocks for investors to buy now, with Boeing not making the list. The team’s recommendations have historically outperformed the S&P 500 and offer insights into potential high-growth stocks for investors.
While the future outcome of this labor strike remains uncertain, it’s evident that Boeing has the means to navigate through the crisis and make strategic decisions to ensure its financial stability.
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