 Good day, fellow investors. Over the last year and something, each time Boeing stock falls, I get a few emails, I get a few comments. What do you think? What do you think? What do you think? And I really think I can add value to those who are interested in Boeing to see some factors that you might be missing when it comes to investing in Boeing. For those that are not interested in Boeing, I really think I can give you a few pointers, a few lessons when it comes to investing here that you can really, really take advantage of in your investing life. So just three things on Boeing, I think it will really add value. So let's start immediately. Each time, as I said, the stock price drops, I get emails, it dropped, I don't know, 10%. Is it a bargain now? Is it a buy now? And the first point I want to make, just because a stock is down, it doesn't mean anything. It doesn't mean it's cheap or it's a bargain or it's an opportunity. If we just take a look at the last year, and this, the red are all the times that I get emails, questions, comments, and whatever about Boeing, Sven, what do you think? What do you think? Is it a bargain? Is it a bargain? Is it a good buy now? And then if you look at this, over the last year, Boeing didn't go anywhere. So that's the first thing. And at the end, stock prices, especially short-term stock price movements, don't have any meaningful impact on your investment returns. You can trade Boeing a little bit, but I would still say it's very, very risky. The key when it comes to investing, and this is point number two, are fundamentals. And this is where most of you have it extremely right. Boeing is one of the two companies doing planes. So it has a competitive advantage. It has a mode. It's very difficult to do to make planes, as we have seen with Boeing issues over the last few years. So it's hard. However, there will be more people flying. There will be more people on earth. There will be economic development, economic growth, low-cost carriers are growing everywhere, long-haul flights. So everything is very, very positive. The fundamentals of the business of Boeing are extremely positive. So you might see, and I get that a lot of in the comments, it's a great business. Yes, it is. No arguing about that. But because something is a great business, because something it is in a positive structural trend with the traveling tourism and more people positive tailwind, it doesn't yet mean it's a great investment. And that's something a lot of you, especially those who send me those emails and comments, if you wish ever to send me an email, I always love to read them because it gets me an idea and it gets me how the market feels. So feel free to ship me an email or whatever you want. Back to Boeing, when it comes to those investments, just because something is a great business, has a great position in the market, it doesn't mean it's immediately a great investment. And that's something we have to be very, very careful about. What we have to look is fundamentals also on the earnings side, not just on the trend, the market, the opportunities side. And if I look at Boeing fundamentals, the gross margin has been always between 15 and 20, but mostly around 15, 16, and just in the last two years, 2017, 2018, it has been so close to 20 when Boeing had such a good margin. And the operating margin was 10 and 11, 11%. Compared to the historical 7%, Boeing made great operating earnings that led to extremely high earnings per share. But this was just two years in history. And I listened to Ryanair CEO in their conference call when I analyzed Ryanair and the CEO said clearly that they are just buying, Ryanair is just buying seven to nine year old planes because margins in the industry for new planes are a little bit on the high end of the historical average, which makes buying new planes not profitable. And they are waiting for those margins to return to the mean or below the mean to buy new planes because then it's economically viable to buy planes. Now, when a CEO who is a smart guy like Ryanair says that margins are high, you know what to expect from a company like Boeing. So when investing in fundamentals, you have to see, OK, the trend is positive, as we said in the industry. But what is the average margins that I can expect from my company? Margins always go up and down. Now they're going down. We had the max issues, not selling planes. Plus we are seeing a lot of bankruptcies in the industry every week. Some bankrupt airline in Europe, which oversupplies new planes to the market, which means that those margins on new planes must go down. And then you see that all those industries have average margins. And those average margins is something you have to use when you're using your earnings model over the long term. Average margins, in this case operating margins for Boeing are 7%, not 11%. And that's a big, big difference when it comes to investing. And that's what you have to implement in your earnings model. And that will give you the fair price for a great business that Boeing is. So if we go back to earnings, we see net income 10 billion in 2018 now dropped to 4 billion over the last 12 months. But if I look at the last 7, 8 years, average net income was 5, 5 billion. Let's say 5 billion with the growth coming in the future and everything. Let's take 5 to 6 billion on a 7%, 7, 8% operating margin. 7 billion average earnings, slow growth. What is the return I can then expect? So I can expect earnings per share of let's say $8 per share times a price earnings ratio of 20 for a good business. I get to a price per share of 160. That should be the fair price for Boeing. And that is a lot lower than the current price. And that is a lot lower of what many of you might expect and a lot lower whether Boeing is a bargain or not. Now, the first step I want to discuss is that you have to look at the long term chart if you must look at charts. In this case, Boeing, we see a lot of volatility, but then a huge boom from 2016, 17, 18. So those earnings improved, margins improved, but the market is expecting that those margins will remain at current levels forever plus growth. That is unlikely. And then that's one positive tailwind for the stock price. And then there is something else, which is financial engineering. Boeing really stepped up. In 2013, they spent $2 billion on buybacks. 2014, $6 billion. 2015, $16, $7 billion. 2017, $18 billion. They went above $9 billion on buybacks. So $9 billion over the last few years, they spent more than $40 billion on buybacks and the market capitalization in 2015 was much lower than the current $200 billion. It was around $70 billion. The stock price was much lower. And when the company spends $40 billion on buybacks on a $70 billion market cap, the stock price can only go up, can only go to the moon. And that is what happened. The problem now is that valuations are high, margins are high. Everything is in a Goldilocks environment. And the soon margins contract, the soon Boeing has less money to do buybacks. Investors will see, OK, this is not going up, this might go down. And then we might see Boeing back to the average long term investment prices. So I think this is really in the state of euphoria now, Boeing's stock. Thanks to the buybacks, thanks to the good returns, thanks to the extremely positive fundamentals and economic environment. And that's something you have to be very careful and you have to watch those long term trends when it comes to investing. So Boeing is a good company, it has a moat, will do well. But the question is, what is the right price for it? Industry growth is 3% per year. They might grow at 5% maybe. They didn't grow fast at all over the last 10 years. Keep that in mind when you look at revenue. With a price earning ratio of 25% return at 3% growth, you might get an 8% return on a price of 200 or 160, which should be the fair value of the company, the long term fair value for a company. Currently, the stock price is really detached for the fundamentals. And if you invest now, you are betting that everything that was so good over the last few years will continue for eternity. And that's a bet I, as a fundamentals investor, don't like. Boeing in 2011, when the stock price was what, 60, that was a good fundamental bet. Not now. So from a value investing perspective, there is value in Boeing, but it's overpriced, over exuberant, and that's something we have to take care and we have to watch for those companies, great companies like Boeing, when those are cheap. And that's exactly what I'm doing. If you want to check everything that I do, check my stock market research platform with all my portfolio sector analysis. And I'm trying to transfer this perspective of buying value when it is relatively cheap for the long term and when the long term trends are subdued, not over exuberant, because when they become over exuberant, I make a lot of money. That's what I do. Check it out. Thanks for watching. Looking forward to comments and I'll see you in the next video.