This week’s Alpha Algorithm recommendation returns us to The Boeing Company (BA) — one of the world’s major aerospace firms.
Recall that you were stopped out of Boeing (BA) on Aug. 9 at $234.30 for a 25.78% gain. Founded over a century ago in 1916 and based in Chicago, the company operates in three principal segments: commercial airplanes, military aircraft and missiles, and space and communications.
The Boeing Company (BA) versus the S&P 500 over the last six months
Fourteen Top Investment Strategies Betting on The Boeing Company (BA)
1. Large-Cap Momentum
The stock is part of a major hedge fund’s systematic strategy that invests in large- and mid-cap U.S. companies with positive momentum and that rank in the top third of total return over the prior 12 months, excluding the last month.
2. Momentum Factor
The stock is one of the top 120 large- and mid-cap U.S. stocks exhibiting relatively higher price momentum, as measured by a specific factor which has historically driven a significant part of companies’ risk and return.
3. Insider Sentiment
The company is one of 100 equally weighted U.S.-listed large- and mid-cap stocks chosen based on trading in company stock by corporate insiders, price momentum and trailing 12-month volatility. Specifically, this strategy looks at the increase in insider holding.
4. Large-Cap Growth
The stock is among the top 50 large-capitalization U.S. growth stocks generated through a rigorous 10-factor fundamental screening process.
5. Large-Cap Alpha Growth
The company has been chosen as part of an alpha-seeking index that selects and weights growth stocks from the S&P 500 Growth Index. The proprietary methodology uses price appreciation — among more traditional factors — and weights the constituents based on their respective growth scores.
6. Capital Strength
The stock is part of a strategy that seeks to outperform the market by selecting companies based on the strength of their balance sheets, long-term debt ratios and return on assets.
7. Share Buybacks
The company’s outstanding shares have been reduced by at least 5% in the previous year through share repurchases.
8. Fundamental Strength
The company is a top U.S. stock based on fundamentals measured by book value, cash flow, sales and dividends.
9. Exponential Technologies
The stock is part of a strategy that invests in nine different fields deemed to be vast growth “exponential technologies”: big data and analytics, nanotechnology, medicine, networks, energy and environmental systems, robotics, 3-D printing, bioinformatics and financial services.
10. Low-Interest-Rate Sensitivity
This is a large-cap U.S. stock selected for its low volatility and positive price performance in a rising-interest-rate environment.
11. Value Tilt
Selected using a multi-factor modeling approach, the company is a value stock designed to enhance portfolio risk/return characteristics.
12. Value Line 100
One of the top 100 stocks in the universe of 1,700 stocks for which Value Line gives a #1 ranking in the Value Line Timeliness Ranking System, based on expected price performance over the following six to 12 months.
13. Large-Cap Alpha Core
The stock is one of a tiered, equal-weighted index of large-cap stocks selected from the S&P 500 expected to outperform the broader large-cap space based on an intricate methodology of ranking stocks according to their recent performance.
14. Goldman Sachs’ Active Beta
The stock is selected according to four factors — value, quality, momentum and low volatility. These, in turn, are based on criteria including book value, sales and cash flow scaled by share price, profit/assets or return on equity (ROE), risk-adjusted returns and daily standard deviation of returns.
Buy The Boeing Company (BA) at market today. Place your initial stop at $220.00.
If you want to play the options, I recommend the BA November $235 calls (BA171117C00235000), which last traded at $11.25 and expire on Nov. 17.
Sell all of your remaining PG October $87.50 calls, which last traded at $5.57, for a 130.17% gain.
Nicholas A. Vardy