When you compare Boeing to its closest competitors, the picture that emerges is more nuanced than most headlines suggest. A Boeing peer comparison across revenue growth, profit margins, valuation, and competitive moat reveals where each company stands on fundamentals and where the real risks hide. Whether Boeing deserves a premium or discount relative to Airbus, Lockheed Martin, and Northrop Grumman depends on which dimensions you weight most heavily.
Key takeaways
- Boeing's commercial aviation duopoly with Airbus gives it a wide moat, but its margins have lagged peers in the defense sector for several years running.
- Lockheed Martin and Northrop Grumman tend to deliver more consistent profitability because defense contracts carry steadier revenue streams than commercial aircraft cycles.
- Revenue growth trajectories differ sharply: Boeing's top line is tied to airline recovery and aircraft delivery backlogs, while defense-focused peers grow through government budget cycles.
- Valuation comparisons between Boeing and its competitors require context, since negative or suppressed earnings can make standard metrics misleading for Boeing.
- Each company carries distinct risks: Boeing faces execution and safety concerns, Airbus faces supply chain bottlenecks, and defense primes face political budget risk.
Who are Boeing's main competitors?
Before diving into a side-by-side comparison, it helps to define the playing field. Boeing operates across two major segments: commercial airplanes and defense/space. That dual exposure means its true peer set spans two different industries, and no single competitor overlaps perfectly.
Airbus is Boeing's direct rival in commercial aviation. These two companies essentially split the large commercial aircraft market between them, creating one of the most well-known duopolies in global business. Lockheed Martin and Northrop Grumman compete with Boeing on the defense and space side, where contracts from the U.S. Department of Defense and allied governments drive revenue. There are other players in both arenas, but these three represent the most meaningful comparisons when you want to evaluate BA vs peers on the metrics that matter.
You can pull up Boeing's financials and research on the Boeing stock page on Rallies.ai to follow along with your own analysis.
Revenue growth: How does Boeing stack up?
Revenue growth is the starting point for any competitor comparison, and it's where Boeing's story gets complicated. Boeing's commercial airplane backlog is enormous, stretching years into the future. In theory, that backlog represents a massive growth engine. In practice, Boeing has struggled to convert backlog into delivered aircraft at the pace investors expected, thanks to production issues and supply chain constraints.
Airbus has generally been delivering aircraft more consistently, which has translated into steadier revenue growth on the commercial side. Airbus's narrowbody lineup, particularly the A320neo family, has been outselling Boeing's 737 MAX in terms of new orders over multiple recent periods.
On the defense side, Lockheed Martin generates the largest share of its revenue from long-term government contracts. These contracts produce predictable, if modest, revenue growth that tracks with defense spending trends. Northrop Grumman follows a similar pattern, with added growth potential from programs in space systems and strategic deterrence.
Revenue backlog: The total value of orders a company has received but not yet fulfilled. A large backlog signals future revenue, but only if the company can execute on production and delivery. For Boeing, the gap between backlog size and delivery pace is a metric worth watching closely.
Here's a rough framework for thinking about revenue growth across these peers:
- Boeing: High potential growth tied to commercial aviation recovery, but execution risk creates uncertainty around actual delivery timelines.
- Airbus: Steady growth driven by strong order flow and more consistent production output.
- Lockheed Martin: Low-to-mid single-digit growth, anchored by long-cycle defense programs.
- Northrop Grumman: Similar to Lockheed, with upside from newer programs in space and nuclear modernization.
Comparing profit margins: Where Boeing falls short
This is where the Boeing vs competitors comparison gets uncomfortable for Boeing bulls. Profit margins tell you how efficiently a company converts revenue into earnings, and Boeing has been an outlier among its peers for the wrong reasons.
Boeing's operating margins have been negative or razor-thin in recent periods, driven by production inefficiencies, fixed-price defense contracts that went over budget, and costs related to the 737 MAX grounding aftermath. When you compare Boeing to competitors like Lockheed Martin, which typically posts operating margins in the 10-13% range, or Northrop Grumman in a similar band, the gap is stark.
Airbus runs tighter margins than the defense primes but has generally maintained positive profitability throughout the same period where Boeing struggled. Commercial aviation is inherently a lower-margin business than defense contracting, but Airbus has managed its cost structure more effectively.
Operating margin: Operating income divided by revenue, expressed as a percentage. It measures how much profit a company makes from its core business before interest and taxes. Comparing operating margins across peers in the same industry gives you a read on relative efficiency.
A useful exercise: when you're doing a Boeing peer comparison on margins, look at the trend over five or more years rather than a single snapshot. One bad year can distort the picture, but persistent margin compression tells a different story than a temporary dip.
What about valuation?
Valuation is where things get tricky when comparing Boeing to its competitors. Standard metrics like price-to-earnings ratios can be misleading or outright useless when a company has negative earnings, and Boeing has been in that situation. Investors sometimes turn to price-to-sales or enterprise-value-to-EBITDA as alternatives, but even those require careful interpretation.
Lockheed Martin and Northrop Grumman tend to trade at relatively stable P/E multiples, typically in the mid-to-high teens, reflecting their predictable cash flows and earnings. Airbus usually trades at a modest premium to the defense names, reflecting its growth profile in commercial aviation.
Boeing, depending on when you look, might trade at an extremely high P/E (because earnings are near zero) or have no meaningful P/E at all. Some investors use forward earnings estimates to justify Boeing's valuation, essentially pricing in a recovery to normalized margins. That approach can work, but it requires conviction that Boeing will actually hit those targets.
Here's what to think about when evaluating valuation across this peer set:
- P/E ratio: Useful for Lockheed and Northrop, less useful for Boeing when earnings are distorted.
- EV/EBITDA: A better apples-to-apples comparison because it normalizes for capital structure differences.
- Price-to-free-cash-flow: Particularly relevant for Boeing, where free cash flow generation is a key signpost of recovery.
- Backlog-to-market-cap ratio: Unique to aerospace, this gives you a sense of how much future revenue is already locked in relative to the company's current price.
You can use the Rallies.ai stock screener to filter and compare valuation metrics across aerospace and defense names side by side.
Competitive moat: Who has the strongest position?
Moat analysis is where Boeing's story improves. Despite its operational struggles, Boeing benefits from one of the widest competitive moats in global industry. Building commercial aircraft is extraordinarily difficult. The barriers to entry are almost impossibly high: regulatory certification alone takes years and billions of dollars. No new competitor has successfully entered the large commercial aircraft market in decades.
The Boeing-Airbus duopoly means airlines have limited choices for narrowbody and widebody aircraft. Switching costs are massive because airlines build their fleets, maintenance infrastructure, and pilot training around specific aircraft families. An airline operating 737s can't easily switch to A320s without enormous expense.
Lockheed Martin's moat is different but equally formidable. Its position as the prime contractor on the F-35 program gives it a multi-decade revenue stream with limited competition. Northrop Grumman holds similar advantages in strategic bomber programs and space systems.
Airbus has the same duopoly advantage as Boeing in commercial aviation, and arguably has been executing better on that advantage in terms of market share gains.
Competitive moat: A sustainable advantage that protects a company from competitors over the long term. In aerospace, moats come from regulatory barriers, switching costs, technological complexity, and long-term government relationships. A wide moat doesn't guarantee profitability, but it does mean the company's market position is hard to displace.
What are the biggest risks facing each company?
Every company in this peer set carries meaningful risks, and they differ in important ways. Understanding these risks is essential when you compare Boeing to competitors and try to decide which has the strongest risk-adjusted profile.
Boeing's risks
- Execution risk: Boeing needs to ramp production, improve quality control, and restore confidence with regulators and airlines. This is the single biggest risk to the investment case.
- Balance sheet pressure: Years of cash burn have loaded Boeing with debt. Deleveraging depends on cash flow recovery, which depends on production execution, creating a circular dependency.
- Reputation risk: Safety incidents have long tails. Regulatory scrutiny remains elevated, and any future incident could set back the recovery timeline significantly.
Airbus's risks
- Supply chain constraints: Airbus has its own production bottlenecks, particularly in engine supply from partners like CFM and Pratt & Whitney.
- Single-aisle concentration: Heavy reliance on the A320neo family means any production disruption has outsized impact.
- Currency exposure: Airbus earns revenue in dollars but incurs costs in euros, creating hedging complexity.
Lockheed Martin's risks
- Budget dependency: Revenue depends on U.S. and allied defense budgets. Political shifts toward deficit reduction could pressure spending.
- Program concentration: The F-35 represents a large share of revenue. Cost overruns or political opposition to the program could create headwinds.
Northrop Grumman's risks
- Fixed-price contract exposure: Like Boeing, Northrop has some fixed-price development contracts where cost overruns eat directly into margins.
- Program delays: Large-scale defense programs, particularly in space, carry schedule risk that can affect revenue recognition timing.
A framework for comparing Boeing to competitors
Rather than declaring a winner, here's a framework you can apply yourself. For each dimension, rank the peers on a simple scale and weight the dimensions based on what matters most to your investment thesis.
- Revenue growth potential: Who has the most room to grow, and how certain is that growth? Boeing may have the highest ceiling but also the widest range of outcomes.
- Margin quality: Who converts revenue to profit most reliably? Defense primes win here on consistency.
- Valuation relative to earnings power: Is the current price fair given normalized earnings? This requires your own estimate of what "normalized" looks like for Boeing.
- Moat durability: Whose competitive advantages are most likely to persist over the next decade? The duopoly structure favors both Boeing and Airbus.
- Risk magnitude: Whose downside scenarios are most severe? Boeing arguably has more tail risk than the others because of its operational and balance sheet situation.
If you want to go deeper on any of these dimensions, Rallies.ai's AI Research Assistant can help you pull together the analysis and run specific comparisons across financial metrics.
Try it yourself
Want to run this kind of analysis on your own? Copy any of these prompts and paste them into the Rallies AI Research Assistant:
- Compare Boeing to its main competitors like Airbus, Lockheed Martin, and Northrop Grumman on revenue growth, profit margins, and competitive moat — which one has the strongest fundamentals, and what are the biggest risks facing each?
- Compare Boeing to its closest competitors side by side — revenue growth, margins, valuation, and competitive position.
- What are the key financial differences between Boeing and Lockheed Martin, and which one has a more sustainable business model?
Frequently asked questions
How do you compare Boeing to its peers on profitability?
The most straightforward approach is to compare operating margins and free cash flow margins across Boeing, Airbus, Lockheed Martin, and Northrop Grumman. Defense contractors typically post more consistent margins because government contracts provide steadier revenue. Boeing's margins have been depressed by production issues and cost overruns, so looking at margin trends over multiple years gives a fairer comparison than any single period.
Is Boeing a better investment than Lockheed Martin?
It depends on what you're optimizing for. Boeing offers more upside if its commercial aviation business recovers to full production rates, but it also carries more downside risk. Lockheed Martin offers steadier earnings and a dividend, with less dramatic upside. The right choice depends on your risk tolerance and time horizon. Always do your own research before making any investment decisions.
What makes a Boeing peer comparison different from other stock comparisons?
Boeing straddles both commercial aviation and defense, so no single competitor is a perfect match. Airbus competes on commercial planes, while Lockheed and Northrop compete on defense. That means you're comparing Boeing against different peers for different parts of its business, which adds a layer of complexity most stock comparisons don't have.
How does BA vs peers look on valuation?
Boeing often appears expensive on traditional metrics like P/E because its earnings have been depressed or negative. EV/EBITDA and price-to-free-cash-flow are better tools for this comparison. Defense peers trade at more stable multiples because their earnings are more predictable. Investors evaluating Boeing's valuation need to make assumptions about what normalized earnings will look like, which introduces uncertainty.
Which Boeing competitor has the strongest competitive moat?
Boeing and Airbus share arguably the widest moat in the group, since the commercial aircraft duopoly has extremely high barriers to entry. Lockheed Martin's F-35 program creates a similar, though more concentrated, competitive advantage. The answer depends on whether you value breadth of moat (Boeing/Airbus duopoly across aircraft types) or depth of moat (Lockheed's dominance in a single critical defense program).
What are the main risks when comparing Boeing to competitors?
Boeing's risks center on production execution, balance sheet leverage, and regulatory scrutiny. Airbus faces supply chain and currency risks. Lockheed and Northrop face defense budget uncertainty and fixed-price contract exposure. The key difference is that Boeing's risks are more company-specific and operational, while the defense primes face more systemic, industry-level risks tied to government spending.
Where can I run a Boeing competitor analysis myself?
You can use the Rallies.ai Research Assistant to ask detailed comparison questions about Boeing and its peers. The platform lets you analyze financial metrics, compare fundamentals, and explore competitive positioning using AI-powered research tools.
Bottom line
A thorough Boeing vs competitors analysis reveals that Boeing has the widest range of outcomes in its peer group. It has a world-class moat and enormous backlog, but its margins, balance sheet, and execution track record lag behind Airbus on the commercial side and Lockheed Martin and Northrop Grumman on defense. The company with the "strongest" fundamentals depends on whether you prioritize growth potential, profitability consistency, or risk management.
The best way to form your own view is to dig into the numbers yourself. For more frameworks on evaluating and comparing stocks, explore the stock analysis guides on Rallies.ai, or download the Rallies.ai mobile app to run comparisons on the go.
Disclaimer: This article is for educational and informational purposes only. It does not constitute investment advice, financial advice, trading advice, or any other type of advice. Rallies.ai does not recommend that any security, portfolio of securities, transaction, or investment strategy is suitable for any specific person. All investments involve risk, including the possible loss of principal. Past performance does not guarantee future results. Before making any investment decision, consult with a qualified financial advisor and conduct your own research.
Written by Gav Blaxberg, CEO of WOLF Financial and Co-Founder of Rallies.ai.