Boeing (BA) continues to prioritize quality and stability as it accelerates commercial aircraft production, and management is being more transparent, which UBS Securities expects will shift the market to valuing Boeing on normalized free cash flow, the brokerage said Wednesday.

UBS models free cash flow of $3 billion in 2026 and $8 billion in 2027, and introduced its 2030 FCF estimate of $20 billion, ahead of consensus and representing a 13% FCF margin, the report said.

In Boeing Defense segment, management is investing to improve quality and expects cost relief to strengthen margin progress in 2026. Cash usage will be lower in 2026, but T-7 and Tanker headwinds will continue through the decade, the brokerage said.

Boeing expects 500 deliveries of 737 aircraft this year, while UBS models 737 reaching 47 deliveries per month by Q4 2026 and 52 per month by Q3 2027. Similarly, the company expects 90 to 100 deliveries this year of the 787 aircraft, while UBS estimates production rate of 9 units per month by Q3 2026 and 10 per month by Q1 2027. The firm believes production rate for 787s can reach 16 units per month by early 2030s.

UBS believes the stock has re-rated and the company will need to continue to show progress for further upside potential.

The firm maintained a buy rating on Boeing and raised the price target to $285 from $275.

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