Valuation of the Boeing Company

Abstract

In this paper I have conducted a comprehensive analysis of the Boeing Company based on popular valuation methods to determine if the share price of Boeing is undervalued, overvalued, or correctly valued. My initial finding is that, the equity price of Boeing differs slightly from the current market price. According to the discounted cash flow analysis, a fair price of Boeing is USD 101.893 which is approximately 26 % lower than the current market price (USD 128,358 as per 31/12/2014). Rather than employing perpetuity method, if instead EBITDA multiple is used as terminal value, then the results shows that the current market price is lower than what it should be. However, comparable company analysis indicates that the price of Boeing is either about right or slightly overvalued. This thesis paper considered the price of Boeing as slightly over-priced.