The Boeing Company (NYSE:BA) was trading at around $193 on October 5, down 11.91% over twelve months. Boeing reported net income of $2.09 billion over the past twelve months. Its EBITDA over the same period was negative $2.9 billion.
Those two figures describe the same year and point in opposite directions. Only one of them tells you what the business did.
READ ALSO: GE Aerospace (GE) vs. RTX (RTX): Which Is the Better Stock to Buy?
The Operations Made Nothing:
Start with the figure that describes the aircraft business itself. Boeing’s operating margin is 0.00%. On $93.99 billion of revenue, building and selling airplanes earned nothing.
That is not a rounding problem. Gross profit was $4.43 billion on that revenue, under five percent for a manufacturer, which means the cost of building the aircraft very nearly equals what customers pay for them.
Negative EBITDA follows automatically, because there was no operating profit to add depreciation back to. Return on assets of negative 1.98% says it a third way. So the $2.09 billion of net income cannot have come from the factories. It arrived below the operating line, from items that have nothing to do with whether an aircraft is built profitably.
That is the answer to the question in the headline. The negative figure describes the business and the positive one does not.
DON’T MISS: Inside L3Harris Technologies (LHX)’s C-HOBS Contract: What the $60M Air Force Award Means for Investors
Where the Cash Actually Goes:
Here the figures turn, and the turn does not hold. Operating cash flow was $3.64 billion against $2.09 billion of reported net income. Cash running ahead of profit has a specific cause here. Aircraft buyers pay deposits long before delivery, so a company working through a backlog collects money ahead of the revenue it can book.
Then capital spending takes it back. Boeing put $3.86 billion into plant and equipment, turning that $3.64 billion into $220 million going out. So the deposits are real and not enough. The factories consume more than the customers’ advances. What it has to outrun is the balance sheet. Debt of $48.36 billion against $19.3 billion of cash gives debt-to-equity of 790.88%, and book value per share of $7.72 is a very thin layer under that.
Return on equity reads 173.54% for the same reason, inflated by a small denominator rather than earned. Boeing pays no dividend. The last payment was made in March 2020. A zero operating margin on ninety-four billion of revenue is the whole problem in one figure. Ten stocks positioned for high returns in 2026 are named here.
The Valuation Case:
Sustainability is better than the accounts suggest. Two companies build large commercial aircraft, and the backlog runs for years, so demand is not the issue. Producing profitably is. On price, every multiple is demanding, at 71.92 times trailing earnings and 49.51 times forward estimates.
Price-to-sales of 1.66 is the only ordinary reading, and it is ordinary because revenue is the one line working. Short interest of 1.80% says the market is waiting rather than betting against it. We named ten stocks for the year ahead, and the list is here.
Conclusion:
The negative EBITDA is the honest figure. A 0.00% operating margin on $93.99 billion of revenue means the aircraft business earned nothing, and the $2.09 billion of net income came from below the operating line. However, the company burned $220 million of free cash over the same period, so even that profit is not arriving as cash. Debt-to-equity of 790.88% leaves very little room. The number to watch is the operating margin, because until it is positive, the earnings are not coming from airplanes.
Market Sentiment:
The Boeing Company was held by 90 hedge funds with a combined stake value of about $7.00 billion at the end of Q2 2026 in the Insider Monkey database. This is down from 99 hedge fund holders with a cumulative investment value of around $6.13 billion in the previous quarter.
READ NEXT: GE Aerospace (GE) vs. RTX (RTX): Which Is the Better Stock to Buy? and Inside L3Harris Technologies (LHX)’s C-HOBS Contract: What the $60M Air Force Award Means for Investors
This article is originally published at Insider Monkey.
