Dave Sather of Sather Financial Group presented his in-depth investment thesis on Boeing (NYSE: BA) at Wide-Moat Investing Summit 2025.
Thesis Summary
Boeing presents a classic turnaround opportunity, driven by recent managerial and strategic changes aimed at addressing significant cultural and operational issues stemming from previous leadership. Since 2018, Boeing faced considerable setbacks due to poor decision-making, excessive financial focus, and deteriorating machinist relations, culminating in major losses and substantial cash burn. Notably, Boeing delivered an average of only 370 aircraft annually post-2018, sharply below its peak of 806 deliveries in 2018. This turbulence, combined with struggles in its defense business, led Boeing to accumulate approximately $36 billion in negative free cash flow over the period.
However, Boeing’s core competitive advantages remain robust, reinforced by its entrenched duopoly position with Airbus in commercial aviation. The significant backlog of over 6,000 aircraft, strong switching costs for airlines, regulatory barriers, and massive scale needed for R\&D and manufacturing underscore Boeing’s intact moat. New CEO Kelly Ortberg, appointed in August 2024 with an engineering rather than financial background, marks a deliberate shift towards quality and operational excellence. Boeing is also set to enhance control over its supply chain with the planned acquisition of Spirit AeroSystems in mid-2025.
The path to recovery hinges on Boeing’s ability to incrementally ramp up production—particularly the critical 737 MAX—and stabilize its defense segment by renegotiating challenging contracts and improving execution. Boeing recently traded at approximately $165 per share, reflecting cautious market sentiment given its recent history. Yet, a successful turnaround could lead to a substantial valuation rerating, with potential intrinsic values ranging between $250 (base scenario) and $300 (bull scenario) per share by the early 2030s, supported by normalized free cash flow and profitability metrics.
A small number of seats at our event of the year, Latticework 2025, will be made available soon to our Substack subscribers. Stay tuned!
Latticework 2025 will be held in New York City on October 7th. In fireside chats with audience participation, the summit will explore intelligent investing in a rapidly changing world. Keynote speakers include:
Chris Bloomstran, President of Semper Augustus Investments Group
Tom Gayner, CEO of Markel and Director of The Coca-Cola Company
Saurabh Madaan, Managing Member of Manveen Asset Management
Bob Robotti, President and CIO of Robotti & Company Advisors
Tom Russo, Managing Member of Gardner Russo & Quinn
Will Thomson, Managing Partner of Massif Capital
Christopher Tsai, President of Tsai Capital Corporation
Ed Wachenheim III, Chairman of Greenhaven Associates
Disclaimer
Wide-Moat Investing Summit 2025 was held from June 24 through July 9, 2025. The content of this website is not an offer to sell or the solicitation of an offer to buy any security. The content is distributed for informational purposes only and should not be construed as investment advice or a recommendation to sell or buy any security or other investment, or undertake any investment strategy. There are no warranties, expressed or implied, as to the accuracy, completeness, or results obtained from any information set forth on this website. BeyondProxy’s officers, directors, employees, and/or contributing authors may have positions in and may, from time to time, make purchases or sales of the securities or other investments discussed or evaluated herein.
Slides
Let’s watch the presentation and look over the transcript.
