RE:RE:RE:Bond holder noise used to artificially suppress the price I think the market recognizes that BBD is still not out of the woods, despite the progress they have made. I don't wish to sound overly negative, but BBD still faces significant challenges.
Firstly, they need to be extremely prudent with their cash usage, something they have had trouble with in the past. Right now, they are expanding their service centres around the world, and building a new assembly plant at Pearson. This takes cash that is also needed for operations, interest payments, and debt reduction.
Net debt is now somewhere around ~$5.1B, so debt to (projected)EBITDA almost 10x.
Also, assuming the proceeds from Alstom shares are used to redeem the Euro bonds and the remainder of Dec 2021 bonds, they have only $2-300M left from the sale, and most of that will be used to pay out the rest of the Mar 2022 bonds. So they will need to raise ~$2B to take care of the rest of 2022 and 2023 bonds.
We all know BBD carries a lot of baggage. They rightly have the reputation of overpromising and under delivering.
Finally, the market may not be sure how to value a pure play business jet manufacturer. One analyst (CIBC?) said effectively, 'we have no one to compare to, so we'll compare them to Ferrari'?!!
I think all these factors contribute to where the s/p is today. The market is saying 'show me'. If BBD can meet their guidance for the year, and take care of refinancing the 2022 and 2023 debt, things will look much different in 2022, IMO.
Jim
HopefulJuan wrote: Good analysis but curious what argument can be made for the very low price to enterprise value multiple. Current price to sales listed at .12. Even Embraer is listed at .54, Others much higher.