It comes in the wake of the door plug of an Alaska Airlines-operated flight blowing off shortly after takeoff earlier this month.
Plane maker Boeing’s stock has taken another tumble after Wall Street analysts downgraded the company’s shares in the wake of an incident with its aircraft earlier this month and a resulting safety investigation.
Wells Fargo analyst Matthew Akers downgraded shares of Boeing to Hold from Buy in a report titled “FAA audit opens up a whole new can of worms,” published on Jan. 16.
He shared his skepticism that Boeing would receive a “clean” audit from the Federal Aviation Administration (FAA), noting that the company is at risk of significant production and delivery delays.
“Boeing has struggled with quality issues for some time, [the] FAA’s audit is limited to MAX 9 for now, but it’s feasible that findings could expand the scope to other MAX models sharing common parts,” Mr. Akers wrote. “Given Boeing’s recent track record, and greater incentive for FAA to find problems, we think the odds of a clean audit are low.”
The Wells Fargo analyst’s price target went to $225 per share from $280.
Following the report, Boeing’s stock slid by 8 percent, just shy of the nearly 10 percent decline that it saw in the wake of the Alaska Airlines-operated flight incident on Jan. 5.
The downgrade comes after the door plug fell off Alaska Airlines Flight 1282 while it was en route to California from Portland International Airport in Oregon, prompting an emergency landing back in Portland.
FAA Grounds Boeing 737 MAX 9 Aircraft
The door plug—a two- by four-foot panel covering an unused emergency door on the jetliner—blew out on the Boeing 737-9 MAX at about 5:11 p.m. local time, roughly six minutes into the flight, when the aircraft reached an altitude of about 16,000 feet.
It left a gaping hole in the plane and caused a rapid loss of cabin pressure while approximately 171 passengers and six crew members were on board, although there were no fatalities or serious injuries.
The plane door was later found in the backyard of a Portland home.
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