Hi Star.
I gotta tell you that this is a good post bellow. I just read your post for the first time, as I get busy throughout the week. Especially now, that I was on vacation for a while. I'm just trying to catch up with work here. So I have some time on the weekend for some leisure. We seem to have a lot of common feelings regarding Bombardier. I noticed that especially, when this morning, I had just posted on that thread to Johnney that the float was now small and how trading of the stock will change, and how the Institutions will be coming in etc., The backlog. The evolution of this company so on. Believe me when I tell you that I hadn't even read this your post yet.
We just happen to think alike about this stock. I am not pretending to know a lot about trading. I can't come near yours, or others trading expertise here. That's not what I do for a living. So forgive me if we duplicate some ideas here on our posts. It's not intentional.
In fact, I appreciate you taking all this time to write so many truths about this company and combining your trading experience to explain the growth of the new Bombardier. Cheers 859
Starsearcher80 wrote: In advance, I have a strong feeling this is going to be a long post. So depending what time of day you might be reading this, grab a coffee, or a beer, and sit back and read slowly. Imho, you are on the precipice of making a LOT of money in this stock, and I want to clearly explain my thoughts as to why I feel so extremely confident that this will be the case.
As I said, I've been in the market for decades now, and have pretty much seen it all. Within those decades, 3 times now, I have come across what I consider to be the "perfect storm" of circumstances to make a LOT of money. This is extremely rare, but I consider Bombardier to be the next in line to experience this perfect storm. Here are the elements that I think absolutely apply to Bombardier, and how the stock fits perfectly into that scneario that can provide such a stunning updraft to the share price.
First and most obvious, you have to have a company with a stunningly good product, well supported, and in srong demand. There's been ample discussion here as to why this is the case for Bombardier, so I won't spend a long time rehashing this here. Suffice it to say that Bombardier's planes are exceptional,for personal, business and military applications. The planes are now in VERY high demand with a strong backlog of orders, and they now fully come with the support of first class service centers around the world that are second to none. Imho, these elements alone make this a $100 stock in my opinion, and I think that's an easy one to consider in the next year or two at the most. Eye-popping? Yes. Realistic?? Absoulutely. Personally, I see absolutely NO reason why this won't be acheived.
But this is where it gets interesting. I think that $100 level is acheivable just on the company prospects alone, and the numbers will ultimately support this. But this is where the "perfect storm" BEGINS, not ends.
To have that true perfect storm for making a LOT of money, you have to have to have the following components.
1) A company that is vastly undervalued to its potential.
2) You finding that company early in the rise.
3) A great story, or in the case of Bombardier, a great turnaround story.
3) Brand name recognition.
4) Complete understandability for the masses.
I'll take each of these individually.
1) Vastly Undervalued: Again, I think this element has been very well discussed here. Suffice it to say that the company is currently vastly undervalued to its potential in the relatively near future.
2) You finding that company early in the rise: If you're hear reading this now, and have a position in Bombardier, you need to appreciate you are an early adopter. Yes, I know some of you have rode out Bombardier's torturous previous past. But that is where the story is unique. We're really talking about two completely different companies, past and present, with both just happening to have the same name. There was the old company, trying to be everything to everybody, not doing anything well at all, and burning through cash at a staggering rate. Then now, there is the new company. Lean, progressive, building world class products that are in demand, and executing brilliantly literally on all fronts.
SO to the people who have been holding on forever, I'll still grant you early adopter status. The past is the past, and has literally no relevance to the present and the future. You evaluate the company on its present day merits, and deserve equally to any of us to be excited about the company and where it is heading. So I'll declare the past officially done. You, in this new company ARE an early adopter, as are we all. And that's a good thing.
It's a good thing obviously because you are in at the beginning stages of a price rise. Now, some people caught the rise early. Personally, I'm in at $20.00 But does the stock being at $35.00ish mean I should take profit? Hell no. It doesn't matter how much you've made or how much you've lost. It matters where the company is going. So using myself as the example, I can be happy with the rise so far, but in the same breath can say, "it's still very early in the rise". And if I think it will have no problem breaking $100, then this level being "early in the rise" is certainly true.
You can also consider yourself an early adopter because you know and understand the transformation that the company has gone through, and see the potential that is there. If you grabbed 100 people off of the street, and asked them about Bombardier, I would bet the following would be true.
a) 100 of them would have heard of the company.
b) 70 of them would think they still made streetcars or subways, or ski-doos.
c) 20 of them would know about the airplane business to the extent that they do "something to do do with aviation.....not exactly sure what."
d) And I bet 1, yes ONE of them would know that they are now exclusively a business jet company making arguably the best business jets in the world.
Esentially then, you, the early adopter, are 1 in 100. You need to appreciate how rare, and how lucky, you are to be hear now, to understand it now, and be in early in the stock now and to be that ONE.
But if only 1 in 100 people even know the story, let alone buy the stock, does that not leave a LOT of people out of the market? And are these not people that could be propelling the stock so much higher? Absolutely! But as the early adopter, that is a GOOD thing that they are not here, just yet. If everyone knew at this point, the stock would already be SO much higher, and you would be paying a lot more for it!
But this is where the perfect storm finds its REAL power. When the masses, the other 99/100 people catch on and see that potential too, THAT is where the pefect storm begins, gains immense power, and makes just a stupid amount of money for the early adopters as the masses pour into the stock. For this to happen though, the masses need certain elements.
A GREAT STORY: The masses need a great story, and Bombardier DOES provide that. In fact, I would go as far as to say that this will prove to be one of the most remarkable turnaround stories in Canadian business history. Good stories are one thing. Great turnaround stories are even more powerful. We all cheer for the underdog, and we all like stories about overcoming adversity and ultimately thriving. It sounds kind of corny, but there's a particularly "Canadian" element here to that underdog story. We tend to be a little more understated as a Nation (not a bad thing), so when this "good" story comes around, we all like to wave the flag just a little and champion that success. And a Canadian company moving forward to be become the best in the world? We LOVE that kind of story! Now, if you don't get what I'm talking about, look no further than the Space Shuttle program and the Canadarm. Damn we were proud as a nation of that robot arm! We built it, and it was as much to say "we can play with the big guys too! Look at us! We contributed too! It works awesome!" The Bombardier story IS a great story, and people WILL get that and be proud of it.
BRAND NAME RECOGNITION: Bombardier has this in spades. Now, it's a little ironic that the masses don't really know what the company really does now, but it's that brand name recognition that counts and the masses know the name well. EVERYONE has heard the name Bombardier and knows it as a big Canadian company. And it's that brand name recognition ignites the masses to become excited about the company and buy into the story.
UNDERSTANDABILITY FOR THE MASSES: You can have a great company, but if the masses can't wrap their heads around what the company does, then it doesn't capture their imagination. So the story has to be good, and the company has to be known, AND the story has to be easily understood by the masses. In the case of Bombardier, the story can be easily understood. "We make the best business jets in the world." EVERYONE knows what a business jet is and everyone understands "best in the world". It's a simple concept to grasp, and that is so important to capturing the imagination of the masses.
So here's where the perfect storm kicks in. If you've got ALL the elements in line for the masses, and the masses start to gravitate to the story, and they like the story, then the masses start to buy. Now, I've seen this phenomenon many times before, where the masses come in and ultimately vault the stock massively beyond the already good place the company was going on it's own. Now, as the early adopter you have to know when it's time to get off that train, but time it right, and you will have made a fortune.
While there aren't a lot of Canadian examples of this phenomenon of the masses, the U.S. examples are everywhere. Look at Tesla. Look at Netflix. The masses took those stocks FAR FAR past where the stock should have ever gone. But it was because all of those elements noted above for the masses were there. The best Canadian example might be Shopify, but even that was a little hard to understand for the masses. Yes, it went massively beyond where it ever should have, but I think it would have even been more so if people could understand what they do.
So, to sum all this up, Bombardier is a company that is going to do extremely well on its own, vaulting share price upwards. But what I'm saying here is that the components for the masses to come in to the stock are ALL there, and not too far off at all. And when the masses start to come in, it happens quickly. The rise becomes stunning as the masses pour in. All of a sudden the stock gets a lot of media attention, which then brings stronger attention still, and even more buying. While the share price vaults forward to a point that the company fully deserves (albeit on a much faster trajectory), the masses have an uncanny ability to overshoot. And then, at that point where all of the masses are saying this is the best thing ever and they all want a piece of the story, well, you take your exit having made a fortune.
Normally, I speak in terms of the masses as mostly everyday retail. But I think there's an added component for Bombardier, that is both unique and unusual, and that the masses of Funds that will be buying. Given the past history of the company, and the vastly reduced share price, the vast majority of Funds had the company on complete ignore. Well then Bombardier did the 25:1 reverse (which I still say was an AWESOME move), and introduced the "new Bombardier" at the same time. Because of this "newness" to Funds, what we're going to see now is Funds tripping over each other to get a piece of the action. Given the tight float now, this has phenomenal potential to really put a potent, if not violent upside move in place. So where are we in this process? Again, I think we are only at the beginning, which is also so damn exciting! We're starting to see that Institutional interest come in, and we're starting to see what it can do to the share price. The key word here though is "starting" and there will be a LOT more Fund interest to come.
Are these effects of the masses in Bombardier's future? I've been around this exact scenario 3 times now in the past 40 years with other companies, and made a fortune on each of them. In comparision, I would say this "story potential for the masses" with Bombardier right now is actually even better than the previous 3. So yes, I'm hugely excited here about the potential here.
So best wishes everyone. You're in the right stock at the right time. Enjoy the stunning ride to come. This story, this win, you'll remember for a long long time!