Boeing shares tumble after Wells Fargo downgrade, China delivery delays By Investing.com

Boeing (NYSE:) shares plunged as much as 7% Tuesday as the plane maker’s issues continued with the Federal Aviation Administration (FAA) extending the grounding of the company’s 737 MAX 9 airplanes indefinitely for new safety checks.

The FAA said it would extend the grounding order on the aircraft to investigate Boeing’s entire production line. The agency has taken the decision after “multiple production-related issues identified in recent years.” According to a recent report by Sky News, FAA administrator Mike Whitaker said the MAX 9 had “significant problems.”

As of 11:35 ET, Boeing shares are down more than 6.7% at $203.25

Furthermore, earlier today, Wells Fargo downgraded Boeing stock to Equal Weight from Overweight, cutting the price target to $225 per share from the prior $280.

Analysts at Wells Fargo believe the production/delivery impact risk has increased “significantly” after the recent Alaska Air flight drama, which saw a mid-air blowout of a panel on a MAX 9.

“We don’t see enough upside to justify this risk and downgrade,” the analysts said. The bank is skeptical about the likelihood of Boeing receiving a clean audit from the Federal Aviation Administration (FAA).

Also pressuring Boeing’s share price on Tuesday is a report from The Wall Street Journal that stated new deliveries of Boeing’s 737 MAX 9s to China face fresh delays.

Citing people familiar with the matter, the WSJ report says that China Southern Airlines, which had been preparing to receive MAX planes in January, now plans to run additional safety inspections on the aircraft.