Boeing - Embraer deal is dead

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FloridaLarry said:
Boeing today (Fri 4/25) said they couldn't complete the deal to take over 80% of Embraer, and were pulling out. Embraer accused Boeing of bad faith and lying about it.

More rich lawyers over this horizon.

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A fleet of parked planes as a result of your failures combined with all your customers parking their fleets of airplanes is really going to eat into your market cap when your main source of revenue is selling airplanes.
 
Boeing is going to be just fine. If you were in Boeing stock from 2008-2018, you might have quadrupled your money. I was late to bail out and almost tripled my (little bit of) money.

We are looking at a tremendous buying opportunity. I'm buying big (big for me) if stock dips to $100 again.

It is very possible that Boeing Commercial Airplanes will be spun off if there's anything that resembles a government bailout in the form of loan guarantees. If that happens, the stock valuation of the new company will be manipulated to satisfy everybody with a stake.

Airbus, on the other hand, is in trouble and no single country has a stake big enough to really care
 
A Motley Fool quote:

"In recent years Boeing has tried to convince airlines to go with the smaller versions of its 737 instead of a plane the size of the A220, in part because it has no real alternative. Embraer's new generation E2 jets would have slotted in below the 737, giving Boeing an attractive offering for customers looking for a plane that size.

Unfortunately for Boeing, smaller-sized jets seem likely to be big sellers in the years to come. Prior to the pandemic, global airlines were already shifting away from larger jets and toward smaller planes. That trend is likely to accelerate if air traffic demand remains below pre-pandemic levels for an extended period. "


So true. IMO Boeing shot itself in the foot.


Now full disclosure, I created a big position with Embraer on the assumption the Boeing deal would go through. Monday the ERJ stock is going to tank. My goal of holding it until the venture buyout was finalized is now toast. Now I don't know how the Brazilian government feels about bailing out their own defense/commercial operator but I hope ERJ doesn't go bankrupt. At this point, I think I'll hold onto these shares for the long term, post-COVID recovery and see what happens. I just hope Embraer shares don't become the next Bombardier shares :aghast:
 
Cherokee_Cruiser said:
A Motley Fool quote:

"In recent years Boeing has tried to convince airlines to go with the smaller versions of its 737 instead of a plane the size of the A220, in part because it has no real alternative. Embraer's new generation E2 jets would have slotted in below the 737, giving Boeing an attractive offering for customers looking for a plane that size.

Unfortunately for Boeing, smaller-sized jets seem likely to be big sellers in the years to come. Prior to the pandemic, global airlines were already shifting away from larger jets and toward smaller planes. That trend is likely to accelerate if air traffic demand remains below pre-pandemic levels for an extended period. "


So true. IMO Boeing shot itself in the foot.


Now full disclosure, I created a big position with Embraer on the assumption the Boeing deal would go through. Monday the ERJ stock is going to tank. My goal of holding it until the venture buyout was finalized is now toast. Now I don't know how the Brazilian government feels about bailing out their own defense/commercial operator but I hope ERJ doesn't go bankrupt. At this point, I think I'll hold onto these shares for the long term, post-COVID recovery and see what happens. I just hope Embraer shares don't become the next Bombardier shares :aghast:
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Fallacy of sunk costs bro! Pull the chute!
 
gotWXdagain said:
Fallacy of sunk costs bro! Pull the chute!
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I guess it all depends on whether he can get out before stock hits rock bottom. If he doesn't have a sell order in place, I think he takes a bath.

He's not falling victim to the fallacy of sunk costs if he can't get out and is stuck with stock at a record low and then sees sticking with it as the best investment opportunity. At that point, sticking with it could be demonstrating an understanding of sunk costs.
 
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Pilot Fighter said:
I guess it all depends on whether he can get out before stock hits rock bottom. If he doesn't have a sell order in place, I think he takes a bath.

He's not falling victim to the fallacy of sunk costs if he can't get out and is stuck with stock at a record low and then sees sticking with it as the best investment opportunity. At that point, sticking with it could be demonstrating an understanding of sunk costs.
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HODL!
 
Pilot Fighter said:
Boeing is going to be just fine. If you were in Boeing stock from 2008-2018, you might have quadrupled your money. I was late to bail out and almost tripled my (little bit of) money.
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Of course, with the benefit of hindsight we now know that these were the years Boeing was slashing development and operating costs in the name of stock price, at the expense of their future pipeline. I would not necessarily expect the stock to perform the same way again post-recovery. You can only kill the goose that lays the golden eggs once.
 
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