What is wrong?Enterprise value is a good method for valuation but it has to be done correctly.
It has to be used in a as going concern basis not in a liquidation basis.
Saying that the clients deposit has to be deduct from cash on hand is wrong. At the time this cash has to be used, new clients will make cash deposits for their orders. it's a roling stone. The cash deposits is a permanent way to finance the operations; that is a part of the Business case for planes makers.
The same as for airlines where clients deposits is a normal way to finance operations and we used the net debt (without excluding some cash); except two years ago when the ''as going concern' situation has stopped (planes were grounded) . The liquidation basis then had to be used.
The same way, in the balance sheet, the works in progress is based on a conservative valuation method approved by auditors based on costs not sales value. So, there an hidden value on these stocks but that's normal ; it is part of accounting methodology and business case. We don't have to make adjustments for everything.
So, the market is saying that the enterprise value of bombardier is now lower than 6,5 B$ Can (4,5 B$ + 2 B$).
My opinion: In the next weeks, the market will become more consequent with the operations. The SP will climb OR we will have some bad news. The actual situation is untenable.