A Crackling Bull Market in Aerospace

 | Nov 18, 2013 | 7:40 AM EST  | Comments
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Stock quotes in this article:

ba

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hon

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pcp

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beav

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aa

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tgi

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tsla

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crm

You can talk about froth. You can talk about what the meaning of Zulily (ZU) and its huge premium, or The Container Store (TCS). You can be furious that Twitter (TWTR) hasn't broken down, and that the short that is Tesla (TSLA) hasn't broken down.

But then you go look at the airplane orders this weekend at the Dubai air show, $100 billion of Boeing (BA) orders, and you say, "I am not going to let these distractions keep me from this incredible bull market in aerospace." These orders for Boeing are orders for Honeywell (HON) and for Precision Castparts (PCP) and for B/E Aerospace (BEAV) and for Alcoa (AA) and Spirit AeroSystems (SPR) and Triumph (TGI). We simply can't let what happened with Obamcare, or with social and mobile, keep us from making that money even as Boeing shares are up huge.

I think Boeing has much further to go. Plus, follow this union issue closely. This company makes a great deal of money off planes, and it has managed to outsource whole functions to other names and then force them to take less than they might otherwise get. That's all simply because Boeing is so powerful to those companies' fortunes.

But the unions are causing huge issues both for timing of planes and margin pressure.

If Boeing moves production for this next iteration jet to another state -- say, South Carolina -- then the out numbers should go even higher.

So, let people jabber on about the high valuations of tech -- including those of the names I am interviewing today at the Dreamforce conference, brought to you by Salesforce.com (CRM). I think the main chance remains with the industrials and their leader, Boeing.

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