Boeing Sees $201K Insider Stock Purchase

Insider buying can provide clues about a stock’s next move. Insiders sell company stock for a number of reasons. Yet they only buy stock for one reason – they expect it to rise.

In this report, we are going to highlight a large insider stock purchase at Boeing Co (BA:US). Boeing is a leading manufacturer of commercial jetliners. It also manufactures defense, space, and security systems. It is listed on the New York Stock Exchange and currently has a market capitalization of around $143.4 billion.

Insider Buying

Our data shows that on July 31, board member Steven Mollenkopf purchased 850 BA shares at a price of $237 per share. This trade cost the insider $201,450 and increased his holding to 3,767 shares.

29% Increase in Holding  

This trade is worth highlighting for a couple of reasons.

Firstly, it has increased the size of Mr. Mollenkopf’s holding by 29%. The fact that the insider has upped his stake by such a large percentage suggests that he is confident the stock is set to move higher.

Secondly, Mr. Mollenkopf has made well-timed trades in the recent past. In November last year, for example, he picked up 1,285 BA shares at a price of $157 per share. Since then, the stock has risen nearly 50%.

Ramping Up 737 MAX Production

Boeing’s recent Q2 results showed that the company has momentum at present.

For the quarter, revenue was up 18% year on year to $19.75 billion, beating expectations of $18.45 billion. 

Meanwhile, operating cash flow came in at $2.9 billion versus $81 million a year earlier.

"We had a solid second quarter with improved deliveries and strong free cash flow generation. We are well positioned to meet the operational and financial goals we set for this year and for the long term,” commented President and CEO Dave Calhoun.

Looking ahead, Boeing said that it plans to ramp up 737 MAX production to 38 per month from 31 per month in a sign that supply chain issues are moderating.

And it reaffirmed its guidance for the year of $4.5-$6.5 billion in operating cash flow and $3.0-$5.0 billion in free cash flow.

In light of these results, we see the insider buying as a bullish development.