Boeing Co (NYSE:BA, ETR:BCO) may be looking to offload its space-related assets, the Wall Street Journal reported late last week.
Bank of America viewed the idea positively, given the division’s underperformance and cost overruns.
The sale could be part of a broader strategic shift under CEO Kelly Ortberg, who has emphasized focusing on core business segments, analysts speculated in a note.
"We see the potential sale as being in line with Kelly Ortberg's comments regarding increasing focus on core businesses," the Bank of America analysts wrote in a note.
Boeing’s space division, particularly its NASA-exposed assets, has faced significant challenges, including delays, budget overruns, and a highly publicized in-space failure of its Starliner spacecraft. The crewed Starliner flight, initially planned as an eight-day mission, is now expected to last eight months due to complications.
The potential sale would likely focus on assets tied to NASA, although Boeing’s military space portfolio and its stake in the United Launch Alliance joint venture with Lockheed Martin are not expected to be part of the deal. The analysts estimate that Boeing Co (NYSE:BA, ETR:BCO) could generate between $1.2 billion and $1.3 billion from such a sale.
“We view the potential sale as a positive,” the analysts said, citing the ongoing portfolio review Ortberg mentioned during Boeing’s third-quarter 2024 earnings call.
While details are still emerging, Bank of America believes the sale would help Boeing reduce its exposure to costly and underperforming areas of the business.