Boeing Co. (NYSE: BA) is creating state-of-the-art manufacturing solutions at its Everett factory to renew its B777 line and to produce the B787 more efficiently. At the same time, its Composite Wing Facility is on schedule. According to one key analyst, these changes should help long-term profitability.

Jefferies has a Buy rating for Boeing with a $200 price target, implying an upside of 13% from Wednesday’s closing price of $176.98. This view on Boeing contrasts greatly from Merrill Lynch’s call from Wednesday. Merrill Lynch maintained an Underperform rating, while lifting its price objective to $150 from $135, implying downside of 23% from Tuesday’s close of $175.96.

According to the brokerage firm, Boeing continues to lead in the civil aviation market, which is growing slightly faster than gross domestic product. Boeing has improved its operating disciplines and has the ability to grow its cash flow per share at a high-single-digit rate over the next several years.

Boeing’s 1.1 million square foot Composite Wing Center for the 777X is on schedule. Jefferies believes the wing that emerges from this center will go a long way toward delivering a 20% improvement in the seat mile cost of the newest 777 over its predecessor. The first several wing forms are being built and will soon undergo testing. The plane will have the longest wingspan of any twin-engine aircraft.

Currently, two-thirds of the 777 is now being assembled using robotics. The gains in quality and reduction in waste should increase assembly speeds and lead to lower costs in the future.

Over the past year, span times on the 787 have declined by 55% to 60%, while more gains are expected as the company plans on removing a work station from the line by the end of the year. North Charleston has been able to introduce the 787-10 into the line with only a minor bump in the learning curve.

In the near term, the company has elected to go with a stretch 737, offering the MAX 10X. Longer term, it appears that the company has an attractive concept for the 4,000-nautical-mile market. The cost for the new 737 is expected to be modest and complements the existing lineup.

Shares of Boeing were last seen at $177.17 on Thursday, with a consensus analyst price target of $175.75 and a consensus analyst price target of $122.35 to $185.71.

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