United Airlines Order Shift and Defense Contracts Fuel Boeing’s Momentum

Boeing's stock is attracting significant attention following a weekend marked by substantial commercial and military developments. A strategic order modification from United Airlines and new multi-billion dollar defense contracts have reinforced a bullish outlook recently articulated by Wall Street analysts.

The positive news aligns with a recent upgrade from Bernstein Research, which named Boeing its "Top Pick" for 2026 on January 15, raising its price target to $298. Analysts argue that constrained supply for new aircraft against robust demand grants manufacturers considerable pricing power. Supporting this thesis are the 2025 order figures, where Boeing secured more net orders than Airbus for the first time since 2018—over 1,170 compared to approximately 889. While Airbus delivered more planes overall, Boeing's order book signals renewed confidence from major carriers.

Trading near its 52-week high, Boeing's share price recently stood at $247.68, just shy of the peak of $247.74. The equity has appreciated more than 40% on a monthly basis.

United Airlines Opts for Larger Dreamliners

On January 17, United Airlines announced a significant adjustment to an existing order, substituting 56 Boeing 787-9 Dreamliners for the larger 787-10 variant. This decision is driven by operational economics: the 787-10 accommodates approximately 336 passengers, compared to 296 on the -9 model. For the airline, this translates to greater capacity per allocated airport slot, a crucial advantage given congested hubs and ongoing air traffic control staffing shortages.

The move indicates a broader airline industry focus on efficiency for 2026. For Boeing, it promises higher revenue per delivered aircraft, as the 787-10 commands a higher price than its smaller counterpart.

Should investors sell immediately? Or is it worth buying Boeing?

Defense Division Secures Major Agreements

Concurrently, Boeing's defense segment landed new substantial contracts. The U.S. Army awarded a contract modification valued at $118.85 million. More significantly, the company is now a participant in a massive Defense Microelectronics Activity (DMEA) umbrella contract with a total ceiling of $25.36 billion. While Boeing shares this award with other providers, it ensures the company's long-term involvement in specialized electronics services revenue.

Further demonstrating progress in key programs, Boeing delivered the second T-7A Red Hawk trainer jet to the U.S. Air Force on January 16. This advancement is pivotal for the future of military pilot training.

Forward Outlook and Market Expectations

Market experts anticipate that Boeing will be positioned to convert its strong order intake into significantly improved cash flow from 2027/2028 onward. This projection assumes a normalization of delivery rates and the resolution of legacy issues within the defense business. The consensus Wall Street rating remains "Strong Buy," with a median price target of $260.

In the coming trading week, the market is expected to fully digest the implications of the United Airlines order modification and the new defense contracts. The $250 per share threshold now appears within reach.