Bombardier Inc. T.BBD.A

RBC: BBD remains our top idea

[Tempo1]

Q4 Airlines & Aerospace Preview
 
Our view:
 
We keep our estimates unchanged with the exception of AC, ..........................We like the set-up for BBD into 2024; which based on our estimates means that the 2025 (multi-year) guide is also looking increasingly conservative with risk to the upside, in our view.
 
BBD.B

Q4 estimates unchanged; price target remains at $98; reaffirm Outperform rating.

We are maintaining our Q4/23 EBITDA estimate of $411MM, slightly below consensus of $419MM. Our estimate reflects a seasonally high 57 total deliveries built throughout the year, generating a strong FCF print of $621MM. Our out-year estimates remain above consensus, and we expect BBD to provide solid 2024 guidance, with upside risk to 2025 guidance on solid execution to date, growth in services, and a supportive business jet market. Key focus into the quarter will be on demand, book-to-bill and services growth. Our price remains at $98, and our target multiple is unchanged at 6.5x.

BBD remains our top idea and trades at a 50% discount to peers

[bbdmic]

I am BBD fan no doubt but all those specialists are they telling us jokes? are they filling ashamed? ...  I asking me the question?   WHERE IS THE BEEF!... GLTALongs!!

[Tempo1]

Many comments like your has been made in the summer of 2022. Just a reminder: The price fell from 50$ to hit a low of 20$. At the time, the analysts stand by their forecasts, lowering a bit the multiples but maintain a bright future.   Some on this board laugh at them. The price hit 74$ 8 months after in march 2023. You are emotive and they are not.

[johnney]

Why do you think those 5induders if the company that sold their options in 2023, and the last one, Martel if those analystes had targets, a few $100! According to you, why haven't they kept their shares, if those analystes banks recommend and outperform the stock! Thusvus the second 5year plan, started in 2015, to finish a 10 year plan, and still believe them, are you sure of this! We are at

[johnney]

Hit $74, 8 months later, but we continued to fall after! $20 low you say! What about that 25 for 1, with a 100 M shares float, when we had 2.4 B shares out in 2018, with a price of more than $5.50, or $135, with almost the double on debt! You why didn't you sold at $74, if you we're in the profit and buy them lower, but you probably didn't cause you we're reading thise toilet

[Noredneck]

johnney... you told everyone that you still own your BBD shares about 1 week ago.... having negative comments MOST of the time doesn't help anyone. If you think it is so negative WHY don't you sell ALL your shares AND move on! DID you also beleive in the $104 Poirier forecast? Are you also a fish that got caught? Dude... sell, I repeat Sell and get over it, someone will buy your shares....

[johnney]

Why I don't sell, I'm in the hole for now! But if I was to be even, long time I would if left this bist more than 5 years, if I could of! GLTA! Looks like I will have to wait till end of year!

[MyNameIsNobody]

This is probably a perfect 'proof is in the pudding' example that the share price isn't behaving as it should. They, analysts, can only look at numbers and comparatives for the basis of their analysis. Hence the share price should be higher.  It's the only logical deduction I can make out of this.  Of course the value of a share is always what someone is willing to pay

[Tempo1]

The bigger mistake to be made is looking at their targets.  But targets is the less important part of their work. Look at the information they give from the bizz jet market, their results analysis, their operational forecasts etc  and make your own opinion. They are not responsible for the market sentiment.

[johnney]

Probally not responsible of the market sentiment, but there is a big reason for this, why, because this is what their past history shows! Investors don't trust at all that PB, even if we don't hear very much from him,lied to investors for years, and today, now we are worth $2, was that price in October 2021, with 2.4B shares out! Every quarter is better, and we continue to stay at $2 pre

[balmusette]

The proof is in the pudding... Owning BBD this last year was like playing a never ending game of snakes and ladders designed by shorters ( 10 snakes for 1 ladder), challenging yes,but we made it to the year’s earnings date ( next week). I am confident that Eric Martel will surprise us again with numbers that will show us the potential this company has, when it is well managed. As MyNameIsNobody

[Shamhorish]

LOL,    yes,   game of snakes and ladders , i hated that game, as much as i hate what shorters are doing with bbd.b (10 snakes for 1 ladder) hope we will escape from their control for a while

[Julyb60]

Balmusette you are mentioning about next week year's earnings date...  Just wondering where you got this confirmation since I have not read any BBD confirmation about the date yet... I know we usually get these results at the beginning of February but this is usually confirmed some time before and yet no news ...  Also, last year we had a pre-release of financial results for 2022

[vonSachsenanhal]

Check Bombardier's own website. Earnings are Feb 8.

[Julyb60]

Thanks Von.  I was checking on the News section.

[balmusette]

Hello July, I got the information from TD Web Broker in the ''research'' section, in the ''event date '' column. They expect BBD to release Q4 results on the 02/07/24. As for pre-release of financial results ; there is nothing on TD's site.

[Julyb60]

Hello Balmusette,  Thanks for the Info.  As per Von's post, it also shows on the Investors section on the BBD investors section (link below).  I missed it because I was looking at the News section. https://bombardier.com/en/investors

[balmusette]

Thanks for the link and update July.

[johnney]

Since beginning 2023, thise Analystes has put those targets die 2024, itls usually a one year target, now we are at 2025, so they all missed! Those prices are for them, putiig it higher, si if it gets's $80 further this year, is for the retail investors to hold them, while their selling and other big shoes, when this got at $74, thise analysts we're pushing it so, their big customers may

[PabloLafortune]

Bombardier trades at a discount to peers mostly because it has too much debt*. Boeing is considered to have a lot of debt and Bombardier possibly has 50% more relative to revenue. So until that changes... *also, for investors who look at a company's balance sheet...., the negative $2B+ of equity doesn't exactly inspire confidence.

[Snowey]

Thanks Pablo, for your quality posts. I continue learning from you. I checked EQUITY looking back. Negative - not good but improving. 2020 = (9.325B) 2021 = (3.089B) 2022 = (2.762B) 2023 = we await results – Feb 8. Best to all longs. Snowey.

[stock4life48]

Q3/2023 = (2.470B) I am thinking we might see (2.2B) on Q4 ER, but maybe I am hoping too much.  we'll see I guess

[johnney]

Quarter 4, important, but what it will be for 2024, cause 2023, belongs to the past !!

[johnney]

There, you got it, until that changes! Won't happen in a few months either!

[Tempo1]

A more complex answer could be : The market is always rating the future of a company, its future earnings. The current or past results are important  only for their helps to estimate the future results. And the future of Bombardier is positive but it has more fragility than its peers causes by: its debt load, its pure player status; no financial backing by others divisions

[johnney]

Not to much positive, what they have to deal with!  I respect this again. Last year the TSX was up more than 23%, and this stock was down 8% + they are now in the TSX 30, not long time ago! Doing exactly the opposite of what it should do, not to Bash, but isn't it what it is!!!

[johnney]

The markets Future doesn't react as it should be!!

[PabloLafortune]

I don't see the problem with failing clients - that's just fear BS IMO. You could replace that line though with dependency on maintaining a healthy backlog. (Boeing by the way has a $520B backlog !?!!?!!!!!!) The root cause of the fragility is the debt. Has been for 10+ years. Say Bombardier had no debt at all. They'd have plenty of cashflow to develop new products or enter new

[Tempo1]

I'm not affraid too by the failing clients, but our personal opinion doesn't matter here.  The last week monday's  7% drop after the VistaJet article is a clear indication that it's an additional fear for ''the market'' sentiment. If Bombardier deliver positive results quarter after quarter, these fears will progressively disappears. Time is the key here.&

[Shamhorish]

i agree with what you said "If Bombardier deliver positive results quarter after quarter, these fears will progressively disappears"

[BBDB859]

I think clients dealing with pricey toys like these, know exactly what they're doing. Just hope the Bomber knows what they're doing with their deposit structure & penalties for default. Nothing to fear there with these clients. These clients are only interested in the OEM' ability to deliver in time, to their specifications. I get the feeling that after Q4 ER we'll get a small

[PabloLafortune]

My unproven theory is that such price drops on sketchy news of that nature wouldn't happen if BBD had much less debt. For 2 reasons: IF the article were true, the impact to a low debt Bombardier would be minor.  And 2nd, that would represent an opportunity to buy discounted shares back. A good example is when the share price dropped to $40. 5% shares buy back would cost $140M USD or 1.6%

[BBDB859]

Your assumption is not theoretical Pablo. It's real or factual. Having lower Debt would change the playing field drastically on the SP.

[johnney]

I agree 100% with your post, yes 100%!!

[Tempo1]

You're right. I made some research and the Moody's methodology for aerospace companies (ex Bombardier) has this framework: Scale (size) 20% Business profile (Competitive position, stability) 20% Profitability 5% Leverage ans coverage 35% Financial Policy 20% Read that Financial policy is strongly related to leverage and coverage.  Surprisingly, profitability is only 5 % but there a