Key Points
- Boeing is reportedly ramping up 737 MAX production, delivering its highest quarterly aircraft volume since 2018 and backed by a $597 billion order backlog.
- Suppliers TransDigm Group and Woodward could benefit from increased Boeing output through higher demand for specialized components and aftermarket parts.
- Analysts remain cautious given Boeing's history of quality and operational setbacks, though successful execution could drive the 28% upside they have forecast for BA shares.
- Special Report: This under $1 stock could become Musk's next supplier
Even several years later, Boeing Co. (NYSE: BA) has yet to really recover from the COVID crisis. The company's stock has made gains as it tries to regain ground lost amid the collapse in global air travel and the grounding of its popular 737 MAX aircraft, with government support for airlines and a recovery in air traffic helping somewhat.
It's only in 2026, though, that signs may be emerging that the major aerospace firm is ramping up production of its 737 MAX line.
Rumors have been flying for months that Boeing would increase its 737 MAX production to 47 aircraft per month; now, though, there is additional speculation that the company could boost its manufacturing even further, encouraged by the U.S. Federal Aviation Administration's certification of the MAX-7 line.
For investors, this presents a two-fold prospect. On one hand, it may be necessary to reevaluate BA stock in light of this production jolt. Additionally, other companies in the aircraft manufacturing space, such as TransDigm Group Inc. (NYSE: TDG) and Woodward Inc. (NASDAQ: WWD), may benefit from downstream demand in the supply chain.
A Much-Needed Shift in Boeing's Narrative
Boeing's operational momentum shift relies on an increase in commercial aircraft production, which could materially improve its financial outlook. The company may be approaching this goal sustainably by creating a disciplined production ramp that will enable reliable, repeatable increases—the fourth 737 production line in Everett, Washington, is key to this development. Doing this is especially important for the company after major quality concerns leading to the 737 MAX grounding in recent years.
Deliveries are one of the most important metrics for Boeing, as each additional aircraft delivered fuels more revenue generation while also improving operating leverage and adding to free cash flow. The more that fixed manufacturing costs can be spread across additional aircraft, the better for the company's margins.
Investors need look no further than Boeing's latest earnings report to find some confirmation that the firm has been successful in its production ramp-up. In Q2 2026, Boeing delivered its highest quarterly volume of aircraft since 2018. It is also backed by a record $597 billion in backlog, or more than 6,200 airplanes. Still, risks remain. From maintaining quality standards to surmounting financial and operational obstacles, there are compelling reasons why many analysts remain skeptical.
The Industry-Wide Ripple Effect Could Be Pronounced
A host of other companies in the aircraft manufacturing industry may benefit as well, particularly if they provide complex, specialized components that make their way into different aircraft across builders.
TransDigm is one contender thanks to its portfolio of pumps, valves, actuators, ignition systems, and similar components. Each additional Boeing aircraft produced and delivered represents an incremental opportunity for TransDigm.
With a standout fiscal Q3 2026—including nearly 23% year over year (YOY) revenue growth and a healthy raise to full-year guidance—the company is already positioned for a share price turnaround following its 13% year to date (YTD) decline.
TransDigm benefits doubly from more Boeing aircraft: not only may parts be included in new construction, but the company's aftermarket parts business notches wins when more aircraft require maintenance and replacement parts.
Woodward Could Also See a Demand Boom
Woodward occupies a similar position to TransDigm in some respects. The company provides fuel systems, combustion technologies, engine controls, and other components. The more aircraft Boeing is producing, the greater the demand for those types of niche products.
Besides the potential of a Boeing tailwind, Woodward's appeal also lies in its defense applications (the company caters to both the commercial air and defense industries).
Given that Woodward's commercial segment is one of its fastest-growing, with a 34% YOY increase in commercial original equipment manufacturing and a 24% improvement in commercial services for the latest quarter, defense may be a nice add-on, while the Boeing ramp-up could provide a core boost to the company's business.
It All Comes Down to Execution
Of course, these benefits may not materialize—for Boeing or others in the industry—if Boeing is not able to successfully execute on its production plans. The draws are many, including much-needed revenue growth, improving margins, and stronger free cash flow, but investors could be forgiven for having middling expectations after the series of disappointments from Boeing in recent years. On the other hand, a win for Boeing's production capacity could enable BA shares to achieve the 28% upside that analysts have predicted.
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