Is Boeing Stock Going to $204? 1 Wall Street Analyst Thinks So.

Boeing (NYSE: BA) is quietly having a good run. It's up 11.9% over the last six months, outperforming the 2.2% decline in the S&P 500 (SNPINDEX: ^GSPC) index in the process. In addition, Melius Research had some good news for investors when one of its analysts upgraded the stock to buy and slapped a $204 price target on the stock. Here's the how and why.

Boeing stock upgrade

As previously discussed, there's a healthy bull and bear debate around Boeing stock, and Melius Research has come down on the bullish side, citing confidence in relatively new CEO Kelly Ortberg's turnaround plans. Buoyed by its recent win over Lockheed Martin for the next-generation air dominance (NGAD) F-47 fighter, the analyst shares management's enthusiasm over the deal.

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Indeed, investors have reason to be confident because the deal is widely reported to be a "cost-plus" deal, rather than the fixed-price development programs that have caused significant losses and margin pressure at Boeing's defense business in recent years. Moreover, Boeing can potentially deliver positive news in 2025 as it ramps up production of the 737 MAX.

Image source: Getty Images.

Is Boeing stock a buy?

The company is moving in the right direction. It also offers a "self-help" story, meaning it can outperform the market simply by better executing on its multiyear backlog. Still, its track record of execution over the last five years is not good, neither in commercial airplanes nor defense.

As such, given the run-up in the stock price, it makes sense to wait and see if the 737 MAX ramp-up is on track. If Boeing can move toward returning the defense business to profitability -- notably by avoiding any more multibillion-dollar charges -- and prevent any costly delays in the launch of the 777X, investors can feel more confident in buying the stock.

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Lee Samaha has no position in any of the stocks mentioned. The Motley Fool recommends Lockheed Martin. The Motley Fool has a disclosure policy.