5 Stocks Most Affected by Inflation

4. The Boeing Company (NYSE:BA)

Number of Hedge Fund Holders: 42

The Boeing Company (NYSE:BA) is an Arlington, Virginia-based aerospace and defense company that is known for manufacturing commercial airplanes.

Inflation and supply chain-related challenges caused the aerospace giant to report a loss of $3.3 billion during Q3 2022. The Boeing Company (NYSE:BA) noted that it observed the heaviest impact on its financial statements from defense plane contracts. These are government contracts based on fixed price points which caused the company to take a financial hit in completing them during an inflationary environment. The inability to pass on the price increases did not play in favor of The Boeing Company (NYSE:BA).

Furthermore, the company lost hundreds of experienced engineers from its workforce as employees decided to take early retirements in 2022. This was done to cash out pensions as employees feared that an increase in inflation could cause a big cut in their pension payouts if they delayed the decision to retire.

Here’s what Meridian Funds said about The Boeing Company (NYSE:BA) in its Q3 2022 investor letter:

“We similarly remained invested in largely out-of-favor The Boeing Company (NYSE:BA) , a global leader in developing and producing commercial jet aircraft. Due to some self-inflicted wounds and a bit of bad luck, as well as dramatic declines in air travel early in the pandemic, investor sentiment for this company has simply been awful. As part of our contrarian thinking, however, we view the business as critical to global transportation needs and see multiple catalysts to improve sentiment. In addition to the current surge in air travel worldwide, ramped up production of the 737 MAX aircraft and the pending restart of 787 Dreamliner deliveries should help turn broader sentiment. Additionally, we anticipate a meaningful inflection in cash flow as Boeing starts delivering aircraft currently in storage as well as the eventual expansion of its production in both core platforms.”