After a challenging year marked by quality control issues and a machinists’ strike, Boeing’s stock plummeted by 32% in 2024. However, Tim Seymour, founder and chief investment officer at Seymour Asset Management, believes that investors should reconsider before abandoning the aerospace giant. Appearing on CNBC’s “Power Lunch,” Seymour shared insights on Boeing’s potential resurgence, positioning it as a compelling opportunity despite the previous setbacks.
Boeing’s Comeback Potential
Since reaching a closing low of $138.14 last November, Boeing has shown a remarkable recovery, climbing nearly 34% as of last Friday. Seymour expressed his confidence in the company’s turnaround, stating, “I can’t quit Boeing, and it’s the wrong time to quit Boeing.” He underscored the necessity for Boeing to stabilize its operations, suggesting that the company has made significant strides in this direction.
Looking ahead, Seymour anticipates that Boeing will become free cash flow positive by 2026, with 2025 serving as a transitional year to get there. “I think this is really a free-cash-flow machine as you look at the future,” he stated, highlighting the potential for sustainable growth.
CVS Health’s Transformation
CVS Health also faced a tough year, ending 2024 with a staggering 43% drop in its stock price. However, the new year has brought renewed optimism, with a striking 47% increase in shares. Following a robust fourth-quarter earnings report, CVS saw a 22% surge in its stock this week, reporting adjusted earnings of $1.19 per share on revenues of $97.71 billion, surpassing analyst expectations.
Seymour referred to CVS as “a turnaround story,” crediting recent leadership changes for the company’s resurgence. New CEO David Joyner, who took the helm in October, has focused on enhancing margins within Aetna’s health insurance division, which had faced difficulties in previous years. “I think the floor is in. I think there’s a margin story. I think they’ve right-sized the business,” Seymour remarked, indicating a positive outlook for CVS moving forward.
Intel’s Struggles Continue
In stark contrast, Seymour cautioned investors against Intel, a stock he believes should be avoided. After a staggering 60% drop in 2024, Intel’s shares briefly bounced back by nearly 24% this week following comments from Vice President JD Vance about the U.S. commitment to defending its semiconductor industry. Despite this potential for recovery, Seymour expressed his disappointment, stating, “The reality is this is a rudderless ship. We need a CEO, we need a plan.” His critique emphasizes the urgent need for Intel to establish a clear direction to regain investor confidence.
As the market evolves, these insights from Seymour offer a glimpse into the potential futures of Boeing, CVS Health, and Intel, each at different stages of recovery and performance. Investors are encouraged to weigh these perspectives carefully before making critical decisions about their portfolios.
