Boeing is the market’s darling

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Boeing is one of the hottest stocks on Wall Street.

Shares soared nearly 90% in 2017. For an encore, Boeing (BA) surged another 16% in just the first three weeks of 2018.

Investors are optimistic about new aircraft orders from major airlines around the globe. That has lifted Boeing’s top rival Airbus too.

Shares of Airbus (EADSF), which trade on the Paris Stock Exchange, are up 10% this year. Last year, Airbus rose 35%.

Boeing has a lot of momentum right now. Wall Street analysts predict earnings surged more than 40% last year. Boeing will report its fourth quarter and full year 2017 results on January 31.

What’s more, profit forecasts for 2018 continue to climb. Wall Street now is forecasting earnings growth of 15% in 2018 and an average increase of 17% annually for the next few years.

Those are obviously fantastic numbers. But is all the good news already priced into Boeing’s stock? Shares now trade at 30 times 2018 earnings forecasts, a much higher valuation than the broader market. The S&P 500 is trading at 19 times 2018 estimates.

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