Management at Boeing (BA) put stakeholders through a rough patch in 2019; I now consider the stock a top speculative idea for 2020, suggests growth stock specialist Jon Markman, editor of Strategic Advantage.

Nine months ago the second of two 737 Max jetliners crashed, killing everyone aboard. The popular plane has been grounded since. Boeing shares have tumbled 20%. The weakness looks like a buying opportunity.

Making commercial aircraft is a unique business. To do it right, a company needs massive scale. Managers must have the latitude to ride the ups and downs, focusing on much longer product cycles.

Consequently, there are only two companies making commercial fleet aircraft: Boeing and Airbus, a European multinational corporation based in the Netherlands. The composition of the industry is important. Like it or not, it means Boeing really is too important to fail.

By most accounts, Boeing managers messed up big time. It looks like the 737 crashes were the result of a software glitch that caused the aircraft to stall on takeoff. The Max is an aerospace engineering oddity. The fourth generation 737 seats up to 230 passengers, a 27% bump over the classic design.

Yet larger CFM turbofan engines positioned ahead of the wing and other changes made it 14% more fuel efficient. Unfortunately, in some cases, the rejiggered avionics caused the nose of Max to lift unexpectedly on takeoffs. Software was supposed to fix this problem.

Grounding  the 737 Max has certainly tarnished Boeing’s reputation and hurt the commercial airplane business. The company announced Oct. 23 that financial costs to that point reached $9.2 billion. But keep in mind, the Max is only one variant of the 737 product line. Over 10,000 737s have been produced, the first commercial jet to reach that milestone. And the 777x, due in 2021, is the largest product launch in commercial jetliner history.

The 777x is a long range, wide body jetliner with 2 new engines, composite wings and terrific fuel economy. It’s the future of the company. Boeing analysts project that 75% of the existing fleet of 19,000 will be replaced in the next 20 years. A further increase of 56% will be needed to accommodate growth.

Meanwhile, the company other businesses are fine. Boeing Defense, Space and Security operates on a global scale. BDS is expected to post 2019 sales between $26.5 billion and $27.5 billion on the strength of rising defense budgets.

Boeing Global Services, the company’s global parts supplier, should have 2019 sales of between $18.5 billion and $19.0 billion. Gross margins are pegged in excess of 15%. Apparently, keeping all of those older 737s in the sky is a great business that keeps on giving.

Investors are worrying too much about one piece of Boeing’s business. In December the company fired Dennis Muilenburg, its chief executive. A fresh set of eyes will refocus investors on the parts of the business that matter most going forward. Shares will seem cheap.

Boeing shares trade at 18.8x forward earnings and only 2x sales. Given where the sector is headed, and the importance of Boeing, that is cheap. The market cap, currently $189 billion, could reach $273 billion in 12 months, a 44% increase.

Subscribe to Strategic Advantage here…