In years past as editor of several aviation publications, an integral part of my job was to fly helicopters and then write about my inflight experiences. As Frank Sinatra sang: “Nice work if you can get it.”

Pictured on the left is me in a helicopter cockpit, readying for takeoff. I still follow the aerospace/defense sector, where I’ve maintained many lifelong friendships.

My contacts in aerospace/defense are telling me that they’re aghast at the multiple woes bedeviling Boeing (NYSE: BA), the U.S.-based global behemoth that manufactures commercial and military airplanes and helicopters.

Boeing is a “blue chip” staple of many retirement portfolios. The stock has long been considered a “Steady Eddy” performer. Not anymore. Since the start of 2024, Boeing’s stock has fallen by about 26% to $183.29 (as of market close April 4).

Is Boeing a bargain right now? Should you buy on the dip? Not unless you want to grasp a falling knife.

The safety scandals that are driving down Boeing’s stock provide an instructive case study for investors. Here’s what we can learn from the company’s travails.

A Litany of Safety Shortcuts

News emerged on April 4 that Boeing paid Alaska Airlines, operated by Alaska Air Group (NYSE: ALK), $160 million in initial compensation for the blowout of a panel during flight.

The mishap occurred on January 5, when a “door plug” on a Boeing 737 MAX 9 aircraft flown by Alaska Airlines failed midair, exposing passengers to the elements thousands of feet above the ground.

The U.S. Department of Justice (DOJ) has initiated a criminal investigation into the aerospace giant. The U.S. Federal Aviation Administration (FAA) confirmed in March that a six-week audit by the agency of Boeing’s production of the 737 MAX 9 jet found dozens of failures and dangerous shortcuts throughout the manufacturing process.

Wait. It gets worse. On March 11, it was reported that a Boeing whistleblower was found dead of a self-inflicted gunshot wound. The apparent suicide is under investigation.

C-Suite Decapitations

Boeing announced a management shakeup on March 25. At the end of the year, CEO Dave Calhoun will resign. Boeing Board Chair Larry Kellner also will step down, handing over his reins to Director Steve Mollenkopf at the company’s annual meeting in May.

Boeing Commercial Airplanes President and CEO Stan Deal also resigned March 25, effective immediately. Chief Operating Officer Stephanie Pope has taken his place.

The FAA has for years allowed Boeing and many other aerospace companies to use their own workers in place of FAA inspectors as part of “self-policing.” Does this policy of deregulation breed conflicts of interest? Of course. And we’re seeing the ugly consequences.

Over the years, Boeing cut corners and scrimped on safety, to boost profits. The company sold its soul to lift its stock price, but karma has caught up with the company.

A consumer boycott of Boeing has emerged, with nervous travelers going so far as to re-book flights to get on a plane made by archrival Airbus (OTC: EADSY).

Safety and production problems have put Boeing well behind European-based Airbus, which delivered 735 aircraft in 2023 to Boeing’s 528. Several of the airlines that use Boeing aircraft are angry and they’re looking to replace Boeing with its competitors.

Within the context of questions over Boeing’s highly publicized problems, the research firm Morning Consult Brand Intelligence recently conducted a survey on public trust in the aircraft maker.

Morning Consult found that between the fourth quarter of last year and January 1-February 28 of 2024, net trust had declined among respondents by 12 percentage points.

The following chart tells the sad story of Boeing’s fall from grace:

Source: Morning Consult

The Red Flags of Impending Disaster

Before investing in a company, you need to lift the curtain to see what you’re really buying.

When several key executives are either getting fired or quitting in a short period, it usually means that the company is suffering internal turmoil that’s born of growing corporate vulnerability. The recent shakeup in Boeing’s C-suite is a huge red flag that the company won’t resolve its problems anytime soon.

Rising short interest is another warning sign. Short interest is the total number of shares that have been sold short by investors but have not yet been covered or closed out. When expressed as a percentage, short interest is the number of shorted shares divided by the number of shares outstanding. If short interest is spiking, it’s a clear signal that investors are souring on the stock and it deserves closer scrutiny.

Boeing’s short interest increased to 10,810,000 shares (latest data, as of March 15), which is a 22.4% increase from the previous month.

Mounting losses on the bottom line are of course another bad sign. Over the last 12 months, BA had revenue of $77.79 billion and -$2.22 billion in losses. Loss per share was -$3.67.

Also beware of a huge debt load. Boeing currently has $15.97 billion in cash and $52.31 billion in debt, giving it a net cash position of -$36.34 billion or -$59.56 per share.

Regulatory or legal scrutiny of a company should always give you pause. Investors should have been tipped off by Boeing’s previous run-ins with regulators and the courts. In 2021, Boeing settled a federal criminal charge linked to two fatal crashes involving its 737 MAX 8 planes.

Under the terms of that settlement, Boeing committed to a payment exceeding $2.5 billion, primarily as compensation to its clientele. Also as part of the settlement, the DOJ dropped a charge accusing Boeing of defrauding the FAA by withholding pertinent information related to the approval of the MAX.

Boeing was for decades the crown jewel of American aviation. Now, the company’s reputation is shattered. Once a respected icon, Boeing has become the butt of jokes by late-night comedians.

However, Boeing isn’t the only erstwhile darling on Wall Street that currently faces public disgrace. Sam Bankman-Fried on March 28 was sentenced to 25 years in prison by a federal judge, a year and a half after Bankman-Fried’s crypto startup, FTX, suddenly crashed.

That said, cryptocurrency is on the cusp of a roaring bull market in 2024. The FTX scandal is actually an encouraging reminder that crypto isn’t a lawless “wild west.” Bad players in the crypto realm are eventually brought to justice.

The FTX scandal also underscores the need for crypto investors to seek expert guidance, to separate the solid investments from the scams. Whether it’s aviation or crypto, every industry has its bad apples.

If you ignore crypto, you’ll be leaving a lot of money on the table. Your portfolio should have exposure to crypto, but you need to be informed, to make the right choices. The good news is, the experts at Investing Daily have done the homework for you.

Want to tap crypto’s massive money-making opportunities, but with mitigated risk? Start receiving our FREE e-letter, Crypto Investing Daily. Click here now!

John Persinos is the editorial director of Investing Daily.

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This article previously appeared on Investing Daily.