Boeing Stock: What To Do Now

It’s probably time to buy The Boeing Co. (NYSE: BA).

Not that the company won’t still face lawsuits and regulatory smackdowns, but what happened at a House of Representatives hearing on Wednesday now looks like a buy signal.

Here’s what happened at the hearing and what to do with Boeing stock if you don’t already own it…

Here’s What I’m Doing

The takeaway from the hearing, where lawmakers questioned acting FAA Administrator Daniel K. Elwell is that pilot error is now the superficial storyline.

Elwell testified that in the October Lion Air crash, the automated anti-stall feature on the 737 MAX activated when it shouldn’t have. He testified that the pilots should have responded by turning off the motors to the part of the airplane that was forcing its nose downward, “but they didn’t,” Elwell said.

The outgoing FAA Administrator also said that when the same automated feature, the Maneuvering Characteristics Augmentation System (MCAS) mistakenly kicked in in the Ethiopian Air crash five months later, the pilots “didn’t adhere to the emergency” directive issued by the FAA in November.

Representative Sam Graves (R-Mo.), the ranking Republican on the full transportation committee, said information from preliminary investigative reports shows there were pilot-related issues with the Indonesian and Ethiopian crashes.

Of course, there are going to be more hearings and more reports and further investigations. And Boeing could get slammed. But, if pilot error, above everything else that was wrong with what Boeing did or didn’t do is at the bottom-line here, then Boeing’s going to recover and possibly quickly.

I want to own Boeing. Here’s how I’m going to play it now.

The $360 price level was important to me. That’s where I expected Boeing’s stock to find support as it fell from all-time highs of $446.

It broke through that $360 support and fell to its next important support level at $340.

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