Boeing's Cramer Praise: A Tactical Signal or a Trap?

Jim Cramer's recent endorsement is a clear, high-profile catalyst that has moved the stock. In a December appearance, he delivered a decisive call, stating I think Boeing has bottomed and that the last quarter was terrific. This wasn't a lukewarm suggestion; it was an unequivocal signal to his audience, including his charitable trust, which holds a big position. The timing is critical: the stock had just experienced a sharp 10% pop on a day it reaffirmed estimates, a move Cramer framed as a classic "hard and fast bottom."

The setup is one of dramatic recent performance. After a brutal 2024 where Boeing posted an $11.8 billion net loss, the stock has staged a powerful recovery. Shares are now up 26% year-to-date and recently hit a 52-week high of $245.49, trading near $241. This rally has been fueled by major order wins and improved production visibility, creating a stark contrast to the free-fall narrative of a year ago.

This creates the core tactical question. Cramer's call, backed by a recent 10% spike, suggests the worst is over. Yet the stock's trajectory-from a $200 low to a $245 high in a matter of weeks-also looks like a classic sentiment-driven move. The immediate risk/reward hinges on whether this is a genuine fundamental inflection or a trap for traders chasing a popular story.

The Mechanics: What Needs to Work for the Thesis to Hold

For Cramer's "bottom" thesis to hold, the stock's recent pop can't just be a sentiment rally. It needs to be anchored in tangible operational and financial improvements. The immediate metrics that must continue to show progress are production stability, cash flow, and a pipeline of new orders.

First, production stabilization is the bedrock. Bernstein's recent price target hike to $277 is predicated on the aerospace firm having improved its 737 and 787 programs. This is the core of the turnaround story. CEO Kelly Ortberg's hands-on, "living on the factory floor" approach is cited as key to regaining FAA trust and safety. The stock's move to a 52-week high of $245.49 suggests the market is betting this operational fix is working. But the thesis is fragile; any new production setback or regulatory delay would quickly undermine this progress.

Second, cash flow is a critical near-term metric. Cramer himself pointed to improved cash flow in the first half of 2025 as a reason for optimism. This is a major shift from the $11.8 billion net loss in 2024. The company's first-half sales also rose 26% year-over-year to $42.2 billion, with the non-GAAP operating loss shrinking dramatically. The market is looking for this cash generation to accelerate, funding the buybacks and debt reduction that would further support the share price. A reversal here would signal the recovery is not yet self-sustaining.

Finally, recent wins like the $930 million Navy deal in December provide a tangible boost and visibility. Yet, the broader aviation market remains sensitive to demand shifts. The stock's 26% year-to-date gain shows it's pricing in a strong recovery, but the underlying demand environment for new aircraft is still volatile. The company must convert these wins into a steady, predictable order book to justify a premium valuation.

The bottom line is that Cramer's call is a tactical signal, but the setup is binary. The stock's rally is a vote of confidence in Ortberg's operational fixes and the improving cash flow. For the thesis to hold, these improvements must now be sustained and expanded. Any stumble in production, a cash flow slowdown, or a demand shock could turn this rally into a trap for those chasing the story.

The Risk/Reward Setup: Near-Term Catalysts and Watchpoints

The tactical setup now hinges on a few clear, near-term events. The primary catalyst is the Q4 earnings report scheduled for January 27. This release will be the first major financial test of the turnaround story since Cramer's call. Investors should watch for beats on both margins and order intake. A strong showing here would validate the improved cash flow and production stability that Bernstein's $277 price target assumes. Conversely, any miss or guidance that raises concerns about the sustainability of the recovery would directly contradict the "bottom" thesis.

The primary risk is a relapse into the old operational problems. Any new production delay, safety issue, or regulatory setback could quickly erase the recent gains and undermine the credibility of Cramer's call. The stock's move to a 52-week high of $245.49 prices in a successful execution of Ortberg's factory-floor strategy. The market's patience is thin; a single misstep could turn this rally into a trap.

A secondary, more subtle risk is that the momentum is driven more by sentiment than by fundamentals. The stock's recent slight boost from the Alaska Air order illustrates this vulnerability. While the deal for 110 jets is large, the minimal stock reaction suggests the market is more focused on the company's ability to actually build and deliver them. This leaves the shares exposed to a broader market pullback or a shift in sentiment away from cyclical industrial names. The rally has been powerful, but it remains anchored to a fragile operational recovery.