Kevin Simpson Adds to Boeing Position, Discusses Industrials and Market Outlook

Boeing Investment Thesis

• ✈️ Kevin Simpson of Capital Wealth Planning has added to their Boeing position, viewing it as a complete recovery story rather than a turnaround.
• 💡 The company has an unbelievable pipeline with approximately $500 billion in orders, representing about 6,000 airplanes.
• 📈 Boeing's objective is to deliver around 47 planes per month, and they achieved 42 deliveries in June, indicating positive momentum.
• 💰 Free cash flow is expected to improve, with the company anticipated to be cash flow positive next year and actively reducing debt.
• 📊 From a valuation perspective, Boeing is trading at about a 12 multiple, significantly lower than competitors like Lockheed Martin trading around 20.

Broader Industrials and Market Concerns

• ⚠️ While Boeing is seen as a stock-specific opportunity, broader concerns exist regarding the industrial sector, including potential impacts from tariffs and rising inventory levels.
• 🏭 There's an ongoing industrial earnings recession, with expectations of acceleration in the second half of the year, but fundamentals are a worry.
• 🏦 Simpson still prefers exposure to financials or tech over industrials for a diversified portfolio.

Other Industrial Holdings

• 🏗️ Capital Wealth Planning also owns a full position in Caterpillar, viewed as a potential play on data center construction due to AI.
• 🤝 Other industrial holdings include Lockheed Martin and Rathon.
• 📉 Boeing's stock was previously sold 5 years ago during COVID when the dividend was cut, and it has struggled to recover until recently with a new CEO.
• 🚀 Revenues at Boeing were up 18% year-over-year last quarter, and they are set to report again on the 29th.