Just sharing some personal lessons learned and experience about investing in companies when their stock appears to be dirt cheap. Boeing (BA) was previously a very solid company with a fairly bright future, but they are now faced with fighting a multi-front war:
- - The 737 Max debacle
- - The precipitous drop in air travel across the globe (and airlines NOT needing, nor affording extra capacity in the foreseeable future); And air travel is truly a luxury, NOT a necessity
- - The major problems with the Air Force's KC-46 program
- - The recent launch failure of the Starliner spacecraft
- - Ongoing labor issues
I say this to put into perspective that this industry and Wall Street "stalwart," is quickly becoming just a "wart."
What's the point of my post? Many will be bottom fishing for cheap stocks during this crash. Relative to Boeing's stock price in DEC 2019, it's now "dirt cheap." HOWEVER, I caution all current and potential investors to think about the list of issues Boeing faces above and their current and impending crushing debt load. It is a real possibility that Boeing (and to be fair, hundreds or thousands of other solid companies) will file for bankruptcy (or "BK") during or after the crash. What does that mean for COMMON STOCK/SHAREHOLDERS? BK typically results in COMMON STOCK SHARES to be WIPED OUT to help shed the company's debt. Here are two articles for your reference, and I wish all "safe and informed investing":
https://www.fool.com/knowledge-center/what-happens-to-stock-prices-after-exiting-bankrup.aspx
https://seekingalpha.com/article/135638-general-motors-officially-wiping-out-common-shareholders