A crackling bull market in aerospace

I think the main chance lies with this group -- and with their leader, Boeing.

By Jim Cramer Nov 18, 2013 10:37AM

TheStreet.com logoBull © Photographers Choice RF, SuperStockYou can talk about froth. You can talk about what the meaning of Zulily (ZU) and its huge premium, or The Container Store (TCS). You can be furious that Twitter (TWTR) hasn't broken down, and that the short that is Tesla (TSLA) hasn't broken down.

 

But then you go look at the airplane orders this weekend at the Dubai air show, $100 billion of Boeing (BA) orders, and you say, "I am not going to let these distractions keep me from this incredible bull market in aerospace." These orders for Boeing are orders for Honeywell (HON) and for Precision Castparts (PCP) and for B/E Aerospace (BEAV) and for Alcoa (AA) and Spirit AeroSystems (SPR) and Triumph (TGI). We simply can't let what happened with Obamcare, or with social and mobile, keep us from making that money even as Boeing shares are up huge.

 

I think Boeing has much further to go. Plus, follow this union issue closely. This company makes a great deal of money off planes, and it has managed to outsource whole functions to other names and then force them to take less than they might otherwise get. That's all simply because Boeing is so powerful to those companies' fortunes.

 

But the unions are causing huge issues both for timing of planes and margin pressure.

If Boeing moves production for this next iteration jet to another state -- say, South Carolina -- then the out numbers should go even higher.

 

So, let people jabber on about the high valuations of tech -- including those of the names I am interviewing today at the Dreamforce conference, brought to you by Salesforce.com (CRM). I think the main chance remains with the industrials and their leader, Boeing.

 

Jim Cramer's Headshot


At the time of publication, Action Alerts PLUS, which Cramer co-manages as a charitable trust, was long HON.



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100Comments
Nov 18, 2013 10:54AM
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Boeing - a huge bright spot in American manufacturing.  And they've shown they aren't afraid of the unions.  At this rate, Boeing could be completely off the West Coast in a matter of a decade or two -  never saw that coming.

If you think about it, transportation manufacturing is really about the only thing we've got left.  We still do a fine job of making cars, trucks, boats, planes, tractors and trains, with or without union labor.  Now if only we could structure trade agreements to where it would be beneficial to use US companies to build all the components here, too.

Nov 18, 2013 3:49PM
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  Many of us here in the northwest do not believe the BA union issue is the real issue but an excuse for BA to look elsewhere. The hand writing was put on the wall a number of years ago when BA moved it's headquarters out of Seattle. BA has been doing more business in other states for a long time. S. Carolina being the most recent at least on scale. Of course they had to agree to build that tanker plant there that Airbus was going to build in order to get the government to cut Airbuses throat on a bid they won. WA state has become a tough state to do business in although there new gov. is supposed to help in that area. The west side is very expensive a virtual city from the Canada to Oregon. Not quite but close. Very expensive for large expansion there
Nov 18, 2013 1:08PM
Nov 18, 2013 4:09PM
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  What's with Barry today. Had him pegged for a Idaho skinhead even called him that. Today he's talking like a real person, maybe even American. I ask once on this blog if you guys were for real or just pulling each others chain for the fun of it, never got a answer. Now I'm really confused.
Nov 18, 2013 4:02PM
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I feel a "scumbag" report coming on.
Nov 18, 2013 3:44PM
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I wonder what the 500 year old clam tasted like?
Nov 18, 2013 11:23AM
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Yup lets put these unions and their American members to bed forever.  The Boeing company has incredible prowess as an American standard.  This was mostly a built up reputation because at one time this was an employee centered work environment.  Employees actually enjoyed working for this employer.  I did a research project exploring the inner values of their employees that showed how loyal and committed these employees were.  Not much of that anymore however.  Imagine all the money this Company has amassed and now they turn their backs on their workers saying they can probably do better elsewhere.   And then to bid it out like they were buying a bunch of shovels. If you want folks to respect and contribute you need to respect and contribute to their success as well.  We have seen this naive self centered transition throughout the US in the last twenty years.  No use at this time to attempt to illict any moral support or understanding of us all working together.  The bottom line is Big Business has the ear of the electerds and nothing will stop this incredible foolish denial of the American workers needs as they are all easily replaced by cheap overseas labor.  I know some revel in the demise of organized labor.  But in reality they are celebrating in the demise of their friends, neighbors, and in essence themselves in the long run.  Wake up America!
Nov 18, 2013 1:48PM
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Not really sure what happened here, besides another train wreck....

Saw a little somewhat civil discussion about Boeing and then Unions...More about Unions, then the building of Aircraft and being built in the U.S.

 

Then we wander around the Political spectrum, eventually coming back to discussion of the Constitution and the Founders...

Eventually breaking down into a name calling session...Yup I'm learning a lot here..

Pretty soon there will be a full blown discourse on "scumbags and manipulators.."

 

Well we have storm damage all around us, and things aren't too pretty...Be happy with what you have and appreciate it....Time for me to start hooking up generators if we are going to survive...

And I only have about an hour left on this thing...Miss LILLY'S laptop...

Nov 18, 2013 6:16PM
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Where is the sideways thumb for Moderates?
Nov 18, 2013 1:46PM
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Well last time we hit records in 2007 and 2008 the market run only a few hundred points more then all came tumbling down.  While a pull back will happen (they always do) let's hope it's not another crash.  Not going to predict how much or when as I've learned that's a fools errand, just going to protect my money for when it does.  Good day all.
Nov 18, 2013 12:17PM
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The South Carolina non-union production line can't get the planes built as fast as the Everett union production line.  The wages are higher with the union, but when you have to deliver planes as fast as you can, you have to deliver planes.

 

 

Nov 18, 2013 6:10PM
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Liberals hijack this forum as often as Conservatives - Thumbs Up

Conservatives are always the ones to hijack this forum - Thumbs Down

Nov 18, 2013 1:44PM
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Bank of America stock at $15.66 !     DIE BANK OF UN-AMERICA DIE !
Nov 18, 2013 12:41PM
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Both the Dow and S&P reached new heights this morning, great.....Now, back to what is happening down here, volume still low and manipulators patiently waiting to sting us all....Be very careful, because we broke a record or two doesn't mean a whole lot....Its all where we close and we still have a long time to go and like we mentioned, the crooks are standing by....More later.
Nov 18, 2013 6:00PM
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ABS....Wish I had time to chime in, on your quest and for your son to consider.

He's young, he has a decent job I take it; That's great..

#1....401Ks are IRAs or are treated accordingly, they can be pre-tax or after-tax, go with PRE.

  He realizes more gain on his income at this time, can and probably will pay tax on later on withdrawls.

Make sure he maxes to get employer's full match.

Put most into Funds about 60% safe domestic blend, 20% aggressive tech, 10% Foreign, 5-10% in cash type, guaranteed interest.

He's young, he's got time and he can weather storms...Don't let him panic if Markets correct..

I only wish I could have done something similar...AT THAT AGE.... 

Nov 18, 2013 5:09PM
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The market manipulators really took the markets for a ride today!!
Nov 18, 2013 11:10PM
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  Good advice from Tog ABS. I always tell my kids and grand kids contribute enough to get match in a 401, hard to beat that idea. Then I prefer a Roth unless you really really need the tax deduction of a regular IRA and the deduction drops you down a income tax bracket. I really believe that if we continue down this socialist nature road the gov. will need more taxes in future years. Taxable investments will likely get hit making ROTHs look even better. Of course the gov. could decide to tax ROTHs saying they have a unfair advantage. This could cause a revolt however, HA! HA! ROTHs give you a much bigger choice of investments about anything you would want from hedging to gold. Takes a little time to learn but worth it. The education you get helps you decide if your mutual funds  are heading the right direction. After all their interest is theirs not necessarily yours. Don't take family time to learn but find the time.
Nov 18, 2013 1:46PM
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The further back one goes back in time, the less accurate the assessment of what really happened and why. Some of the Founders were just as terrified of certain Religious folks as everyone else. That has been true since the very start of humans. And the Founders were targeted just as the Tea Party targets folks today. Most can read but most can't comprehend just basic concepts. Thank God the Founders weren't so dumb but were just the polar Opposites of Today's farce Tea Party frauds.

Meanwhile some forget that our economy has been built on a Fiat Based farce system for DECADES. A bull market built on a shady foundation always ends badly. Our job is to profit form it and cash out before everyone else does. The bigger the Scam the bigger the Bust. This will be no different. Yellen is embracing the same BS that Uncle Ben and Greenspan has before her. She will carry the historical blame along with those two. It will soon be an American Tragedy.

Nov 18, 2013 2:23PM
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At last ... the markets have caught up to where they were before the financial melt down!
Nov 18, 2013 12:37PM
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MSN News says -- "The major idexes reach the psychologically important levels for the first time as the US economy improves, companies report bigger profits and the Federal Reserve keeps up its easy-money policies."

Rally?  Not so sure ... haven't we just caught up to where the markets were before the financial melt down?

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