Bombardier Inc. T.BBD.A

TD: Q1 = a bang!

[lb1temporary]

Q1/23 Canadian Aerospace and Defence Preview

Our Canadian A&D coverage group will start reporting Q1/23 results on April 27. We forecast that Q1/23 results will be in line with consensus, except for Bombardier, which we believe could exceed consensus EBITDA estimates (adjusted EPS is NM). We have adjusted our group forecasts to reflect updated economic, currency, interest rate and aircraft production-related assumptions, the net impact of which is immaterial to our forecasts. Our recommendations (Exhibit 2) remain unchanged.

Strength in Bombardier and CAE's share prices have resulted in returns to our targets that meet TD's threshold for BUY recommendations. However, we believe that it is prudent to review Q1/23 results and make any appropriate revisions to our financial forecasts before considering any changes to our recommendations and/or target prices.

Bombardier:

We forecast 41% y/y growth in Q1/23 Adjusted EBITDA, in line with the 40-50%+ growth over the past three quarters. Growth is due to a 19% increase in deliveries and margin expansion from declining costs on the Global 7500, improved pricing, aftermarket services growth, and other cost-saving initiatives. Although the extreme undervaluation of 2022 has largely corrected, we still view the current valuation and deleveraging potential as providing attractive risk-adjusted upside potential for investors.

Dtailed numbers are:

Revenues: 1 426 M$
EBITDA: 235 M$
Deliveries : 25
Orders: 37
Book-to-bill: 1,5
Booking: 15, 464 M$

[Form001]

TD target February 10 was at 83.00, should see around 90.00. Like the booking at 15.464B US.

[Mauserintime945]

This is a very good news for more than 37 new aircraft order ?

[MyNameIsNobody]

Mauser - Unless I've read too fast this isn't news, it's what they, TD analysts, expect. It would in fact be great news and there's only 8 days to go.before we know what's what. GLTAL

[Mauserintime945]

I only hope that their prediction will come true this time.

[Form001]

Habitually, the majority of analysts have some good numbers because they call the management, main reason why they upgrade or downgrade a stock before the results.

[stockitnow]

Very true.  This is why I take all analysts "storytelling" with a grain of salt. Analyst by putting report like this sets the expectation for the quarterly results.  This causes retail investors to jump on and prop the sp.  When the actual results come in and it doesn't meet the Analyst targets then sp goes down as these same investors leave.  It doesn't

[Form001]

Analysts always running the show, from last summer, we have an upgrade of around 10.00 per quarter, not bad. Concerning the volatility, overbought and oversold is part of the game.

[johnney]

You're 100% right for the Analysts!

[Acuras1]

If these metrics are achieved for Q1 2023 it will demonstrate how cheap the shares remain:) GLTA

[Truthifest]

To me, by far the biggest part of these Q1 estimates is 37 orders, for a b2b of 1.5.  Holy smokes, that would be fantastic.   lb1temp, does TD's report say how they came up with 37?  Thx.

[lb1temporary]

No, I copy all the comments. It's report for all the Aerospace sector. I watched his previous reports and didn't find evidence that he is change his mind about the booking. So, is this preview baseless? I don't know.