How Sterne Agee Is Boosting Boeing - Boeing (NYSE:BA)

Boeing CoBA

gained ground on Friday after Sterne Agee's price target revision to $196. Under normal circumstances it would probably take BA a while until (if) it reaches that goal, especially when you keep in mind the size of Boeing and that the company's stock isn't prone to wild moves usually.

However, brokerage firm Sterne Agee estimates that Boeing will generate $23 billion in free cash flow from fiscal 2015 through fiscal 2017. From this, about $16 billion could be used for buying back shares after dividends, according to the firm. If all this did happen, then there would be 15 percent less shares outstanding. A reduction in shares outstanding would boost EPS and help investors to see more value from their shares.

For the current quarter, there have been 3 positive estimate revisions and 6 negative estimate revisions for BA.

30 days ago, the consensus estimate called for an EPS of $2.05 for the quarter. Since then, the consensus estimate has gone down to $1.92. However, the company has ended up posting positive earnings beats in each of the last 4 quarters by an average of 13.72 percent.

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