BBD NEWSIF YOU LIKE this knid of info, please give thumb up, so i continue to post, if you do not like it give thumb down, so i do not post similar news, thanks The 9.5% return this week takes Bombardier's (TSE:BBD.B) shareholders three-year gains to 306%
Link Bombardier Inc. (TSE:BBD.B) shareholders might be concerned after seeing the share price drop 14% in the last quarter. But that doesn't change the fact that the returns over the last three years have been spectacular. In fact, the share price has taken off in that time, up 306%. So the recent fall doesn't do much to dampen our respect for the business. The only way to form a view of whether the current price is justified is to consider the merits of the business itself.
Since the stock has added CA$484m to its market cap in the past week alone, let's see if underlying performance has been driving long-term returns.
While the efficient markets hypothesis continues to be taught by some, it has been proven that markets are over-reactive dynamic systems, and investors are not always rational. One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.
Bombardier became profitable within the last three years. Given the importance of this milestone, it's not overly surprising that the share price has increased strongly.