Canaccord analyst Kenneth Herbert was out yesterday with a research report on shares of Boeing Co (NYSE:BA), providing analysis of the services market and its effect on the aerospace giant.

Positive on Boeing’s move to capture a more significant share of commercial aftermarket profits, but “skeptical that commercial services alone can drive” enough improvement in Boeing commercial airplanes (BCA) margins, Herbert reiterates a Hold rating on BA with a $144 price target, which represents just under an 8% increase from where the stock is currently trading.

Currently, BA’s Commercial Aviation Services (CAS) is an approximately $8.1 billion business with potential to generate $1.1 billion in 2016 operating profits, in which Herbert recognizes significant opportunity.

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From the analyst’s perspective, “The broad commercial services market is a ~$2.8T market over the next twenty years. On an absolute basis, Boeing has a ~6.5% share of this fragmented market, trailing only GE. In our model, we believe CAS can be a ~$10B business in 2020, with 16% margins, which will represent over 40% of the limited BCA margin expansion we currently expect.”

However, Herbert’s main concern lies in whether the commercial services business can offer substantial contribution to mid-teens BCA margins, which he doubts will be able to be “nearly enough to hit the long-term targets.”

As usual, we like to include the analyst’s track record when reporting on new analyst notes to give a perspective on the effect it has on stock performance. According to TipRanks, four-star analyst Kenneth Herbert is ranked #552 out of 4,123 analysts. Herbert has a 55% success rate and garners 5.4% in his annual returns. However, when recommending BA, Herbert loses 3.7% in average profits on the stock.

TipRanks analytics demonstrate BA as a Buy. Based on 12 analysts polled in the last 3 months, 7 rate a Buy on BA, 4 maintain a Hold, while 1 issues a Sell. The consensus price target stands at $150.80, marking a nearly 13% upside from where the shares last closed.