TLDR
- Boeing stock rose 2% Wednesday after winning a Pentagon contract worth more than $20 billion.
- The deal covers development of the Navy’s sixth-generation F/A-XX Strike Fighter.
- Boeing beat out Northrop Grumman for the award.
- The win follows Boeing’s 2025 contract for the Air Force’s F-47 fighter jet.
- Morgan Stanley separately flagged Boeing as a tactical buy ahead of a key labor vote.
Boeing (BA) stock climbed 2% on Wednesday. The move came after the Pentagon picked Boeing over Northrop Grumman (NOC) for a major Navy contract.
The deal covers the sixth-generation F/A-XX Strike Fighter. It is worth more than $20 billion for the full development phase, according to the Pentagon.
This is Boeing’s second big fighter jet win in under two years. The Air Force handed Boeing the F-47 contract back in March 2025.
Together, the two awards put Boeing in charge of next-generation fighter development for both the Navy and the Air Force. That’s a rare position for one contractor to hold.
Analysts had largely expected this outcome. Matthew Akers, an aerospace and defense analyst at BNP Paribas, said the market already saw Boeing as the favorite given its F-47 win last year.
Why the win matters for Boeing’s factories
The contract strengthens Boeing’s defense business at a time when its commercial side is under pressure. It also boosts the company’s St. Louis operations.
Boeing is investing in new manufacturing capacity there. The company has said the facility is built to support multiple next-generation aircraft programs at once.
Boeing stock is still down 13% year to date. September alone brought a 10% slide tied to a software bug, certification delays on the 737 MAX 10, and a labor contract set to expire.
Morgan Stanley weighed in on that backdrop in a separate note Tuesday. The firm kept its Equal-weight rating and $250 price target on Boeing.
That target implies roughly 33% upside from current levels near $187. The bank called the setup ahead of an Oct. 1 labor vote a possible tactical buying opportunity.
The labor vote investors are watching
The Society of Professional Engineering Employees in Aerospace represents Boeing’s technical and engineering staff. Voting on a revised contract offer closes Oct. 1 at noon Pacific time, with results expected that afternoon.
If the contract passes, one of Boeing’s near-term overhangs clears. If it fails, Oct. 7 becomes the earliest possible strike date, though rejection alone doesn’t guarantee a walkout.
History offers some context here. SPEEA has struck Boeing once in a full sense, a 40-day stoppage in 2000, plus a one-day walkout in 1993.
That’s a different track record than the IAM machinists union, which struck Boeing seven times between 1948 and 2008. The bargaining councils representing SPEEA members are currently recommending a yes vote.
Separately, Boeing’s 737 MAX 10 program faces its own questions. FAA commentary has suggested possible certification delays tied to a software issue already affecting MAX 7 deliveries.
The MAX 10 makes up roughly 24% to 25% of Boeing’s expected 2027 backlog, according to Cirium data. Some of that risk could be offset if operators convert MAX 10 orders to MAX 8 or MAX 9 variants instead.
Boeing’s second-quarter results, reported July 28, showed revenue of $24.6 billion on 171 commercial deliveries. The company posted a GAAP loss of $0.67 per share, with free cash flow of $0.6 billion for the quarter.
Boeing’s total backlog grew to a record $715 billion, including more than 6,200 commercial airplanes. The Oct. 1 labor vote result is expected to land that afternoon.
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