Shares of Boeing Co. (NYSE: BA) dropped more than 3% at one point Monday morning following a downgrade from Neutral to Sell by analysts at Goldman Sachs. That’s pretty harsh treatment for a stock that posted a new 52-week high last Friday and had gained nearly 25% in the past 12 months.

How long can the orders for new planes keep pouring in? And just because new orders continue to roll in, does that mean that the planes actually will get built? It is those very numbers that analysts at Goldman cited as the reason for their downgrade. According to TheStreet, the Goldman analysts wrote:

The group has outperformed substantially, while downside risks have heightened. … After nearly a decade of undersupplying the market, Boeing and Airbus have caught up. Boeing and Airbus total production in 2015 will be close to double 2008 production. A seats based supply/demand model suggests the OEMs are now oversupplying the market.

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Canaccord Genuity said nearly the same thing back in October:

[W]e are concerned that the risk of over producing on the narrow-body market increases substantially as [production] rates go up. As a general rule of thumb, many suppliers cite 100/month combined for both Boeing and Airbus as a natural limit, and are concerned that anything above this level is unsustainable for more than a short period of time.

Over the past six years, Boeing’s stock price has gained more than 420% and Airbus stock is up more than 340%. More than half of each company’s gain came in the past two years or so. Order books are bulging at both firms, and both aircraft makers have announced increases to their production their single-aisle, narrow-body planes, the Boeing 737 and the Airbus A320, to 47 and 46 a month, respectively, from around 42 currently.

Boeing has also suggested that it can boost 737 production to 52 — and 60 is not out of the question. If Airbus should match those totals — and there is no reason to believe it won’t — a combined 104 to 120 narrow-body planes would be rolling off the assembly lines every month.

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Goldman and Canaccord Genuity both see that as something like the old Cold War policy of “mutually assured destruction.” Right now, Airbus has captured a majority of the single-aisle market and Boeing has the larger portion of the dual-aisle market. And even the market for the larger plane will get more crowded as Airbus adds a new version of its A330 and a long-range version of the A321, both threatening Boeing’s hold on that part of the market.

The downgrade had pushed Boeing’s shares down about 2.5% to trade around $154.37 shortly after the noon hour on Monday. The stock’s 52-week range is $116.32 to $158.83, and as we noted, the high was posted last Friday.

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