Goldman Sachs Removes Boeing (BA) from Conviction Buy List on 787 Risks

January 16, 2013 8:40 AM EST
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Goldman Sachs removed Boeing (NYSE: BA) from its Conviction Buy List and cuts its price target from $98 to $90 following news a All Nippon Airways (ANA) flight made an emergency landing with reports of batteries issues. This follows the January 7 incident when Japan Airlines 787 experienced a fire reportedly from an overheating of a lithium ion battery.

The firm remain bullish on the fundamentals of the sector, earnings and cash flow growth, shareholder-friendly capital deployment, and valuation. They also believe it is normal for new aircraft programs to experience early challenges and said it remains possible that the recent 787 issues fall in to the "teething" category. That said, with two incidents in a very short period pointing to battery issues, it heightens the risk of a
potentially more meaningful required change to the aircraft and therefore a possible delay in the pace of the production ramp.

For an analyst ratings summary and ratings history on Boeing click here. For more ratings news on Boeing click here.

Shares of Boeing closed at $76.94 yesterday.

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