Boeing Co.’s stock slipped 0.4% in premarket trade Friday, after the aerospace giant was downgraded at J.P. Morgan in the wake of reports of an accounting probe. Analyst Seth Seifman cut his rating to neutral, after being at overweight for at least the last 3 1/2 years, and slashed his stock price target to $120 from $142. He said he believes the chief risk of a probe into program accounting on the 787 and 747 aircraft, is potential for impaired 787 cash flow expectations. While Seifman believes that outcome is unlikely, “787 cash is central to our investment case and not, therefore, an area where we want to take an incremental risk,” Seifman wrote in a note to clients. He said the probe also saps investor confidence, which has already been running low. Boeing’s stock had tumbled $7.91, or 6.8%, on Thursday–the 2nd-biggest price decline since the company want public in 1972–after Bloomberg reported, citing unnamed sources, that the SEC was investigating whether Boeing properly accounted for the costs and expected sales of its 787 and 747 aircraft. Boeing declined Thursday to comment on the report. The stock has plunged 25% year to date, while the Dow Jones Industrial Average has lost 10%.
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