“Sometimes a company’s long-term prospects are so strong that you’ve got to be willing to endure the short-term agony when management screws up, and they are. But that’s why it’s worth it to take the pain in Boeing,” the “Mad Money” host said.
Cramer’s comments Thursday came after American Airlines announced it’s trimming its international flight schedule for next summer, attributing the move to lengthy delivery delays involving Boeing’s 787 Dreamliners.
It was the latest remainder of Boeing’s operational challenges in recent years, including two 737 Max crashes in 2018 and 2019 that killed 346 people in total. The company has also faced headwinds associated with the Covid pandemic and the related slowdown in travel demand.
Cramer said his charitable trust has “been pummeled by Boeing,” which is down 3% year to date after closing Thursday’s session at $207.56 per share. The stock is down about 40% over the past two years.
However, he said his commitment to Boeing’s stock is not because he’s stubborn and can’t admit an investment mistake.
Rather, he said it’s because he believes better days are ahead for the company, including structural demand from airlines upgrading their fleets to newer, more fuel-efficient planes. Additionally, he said continued improvements in the pandemic should spark strong travel demand in 2021.
“While the short-term is absolutely horrible … I think the long-term is ridiculously bullish,” Cramer said. “If you sell Boeing’s stock here, I think you’ll be kicking yourself, but I don’t know when. I can’t tell. Just like those of us who were foolish enough to sell CVS or Viacom because we couldn’t see when the turn would happen.”
Sign up now for the CNBC Investing Club to follow Jim Cramer’s every move in the market.