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Bombardier stock target increased, upgrades to buy on company's performance

EditorNatashya Angelica
Published 05/23/2024, 12:50 AM

On Wednesday, Bombardier (OTC:BDRBF) Inc. (BBB/B:CN) (OTC: BDRBF) received an upgrade in its stock rating from BofA Securities, moving from 'Underperform' to 'Buy'. Alongside the rating change, the firm also significantly increased the price target for the company's shares, setting it at C$120.00, up from the previous C$52.00.

The upgrade comes as the analyst observed Bombardier's effective navigation through a challenging turnaround period. The company's performance post-Covid has been particularly noted, with business jet (BizJet) aviation activity not only rebounding but also surpassing 2019 levels. This trend is viewed as a positive indicator for Bombardier's near-term strategic plans.

Bombardier's current focus on leveraging its existing customer base, expanding its aftermarket services, and maintaining disciplined capital deployment has been highlighted as a move that could lead to potential gains. BofA Securities sees these efforts as a solid foundation for Bombardier's future performance.

The analyst's comments reflect confidence in Bombardier's direction: "Following the peak of post-covid BizJet demand, BizJet aviation activity remains above 2019 levels, which we see as supporting BBD's near-term strategy." The analyst further pointed out the company's shift towards 'harvesting its installed base' and 'growing its aftermarket business' as strategic steps that could unlock additional value for shareholders.

With the upgraded rating and new price objective, BofA Securities signals its belief in Bombardier's capacity to capitalize on current market conditions and its strategic initiatives. The firm's adjustment in the stock's outlook underscores a significant shift in expectations for Bombardier's financial trajectory.

InvestingPro Insights

Following the recent upgrade from BofA Securities, Bombardier Inc. (OTC: BDRBF) has garnered attention with its promising financial trajectory and strategic initiatives. In light of this, real-time data from InvestingPro provides further context on the company's performance and outlook.

As of the last twelve months leading up to Q1 2024, Bombardier boasts a revenue growth of 10.59%, underscoring its effective market navigation and rebound post-Covid. Moreover, the company has achieved a significant gross profit margin of 20.52%, indicating healthy financial management and operational efficiency.

InvestingPro Tips suggest that while analysts have revised their earnings expectations downwards for the upcoming period, the stock's strong return over the last three months, coupled with a 54.56% price total return, reflects investor confidence. Furthermore, Bombardier's trading near its 52-week high and the absence of dividend payments point to a reinvestment strategy aimed at fueling growth.

For investors seeking deeper insights and additional tips on Bombardier, there are currently 9 more tips available on InvestingPro's platform. To access these insights and enhance your investment strategy, use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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