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Bombardier (TSE:BBD.B)
TSX:BBD.B
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Bombardier (BBD.B) AI Stock Analysis

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Bombardier

(TSX:BBD.B)

Rating:73Outperform
Price Target:
C$182.00
▲(11.57%Upside)
Bombardier's strong earnings call and technical bullish momentum are major positives, offset by valuation concerns and balance sheet risks. The company's strategic growth initiatives and improved cash management are promising, but high debt levels and market price may pose risks.
Positive Factors
Aircraft Demand
Business jet demand fundamentals are solid, with strong flight activities and declining inventories of used aircraft supporting the market.
Earnings and Cash Flow
Improving end market demand, cost restructuring, and lowered interest costs are expected to significantly enhance earnings and cash flow.
Financial Performance
Despite fewer deliveries and a less favorable aircraft mix, BBD exceeded financial targets, reflecting resilience.
Negative Factors
Supply Chain Challenges
Supply chain issues, particularly with engine deliveries, remain a challenge for the company.
Tariff Risk
Tariff-related uncertainties may create disruptions in orders, posing a potential challenge.

Bombardier (BBD.B) vs. iShares MSCI Canada ETF (EWC)

Bombardier Business Overview & Revenue Model

Company DescriptionBombardier Inc. (BBD.B) is a Canadian multinational manufacturer specializing in the design, development, and production of business jets. The company operates primarily within the aerospace sector, offering a range of aircraft including the Learjet, Challenger, and Global series. Bombardier focuses on providing high-performance business aircraft, aftermarket services, and specialized aircraft solutions to customers worldwide.
How the Company Makes MoneyBombardier generates revenue through the sale of business jets, which forms the core of its income stream. The company also earns money from providing aftermarket services, including maintenance, repair, and overhaul services, as well as the sale of spare parts to its aircraft clients. Additionally, Bombardier's specialized aircraft solutions, which tailor aircraft for specific roles such as surveillance or medical evacuation, contribute to its revenue. Strategic partnerships and contracts with government and private sector clients further enhance the company's earnings.

Bombardier Earnings Call Summary

Earnings Call Date:May 01, 2025
(Q1-2025)
|
% Change Since: 79.02%|
Next Earnings Date:Jul 31, 2025
Earnings Call Sentiment Positive
The earnings call reflects a positive sentiment with strong revenue and EBITDA growth, strategic diversification in services and defense, and a positive outlook for the Global 8000. However, supply chain challenges and uncertainties around order activities are notable concerns.
Q1-2025 Updates
Positive Updates
Strong Revenue Growth
Revenue increased by 19% year-over-year to $1.5 billion, driven by three additional deliveries, higher Defense revenues, and stronger pricing.
Adjusted EBITDA Increase
Adjusted EBITDA recorded a 21% year-over-year jump to $248 million, representing a margin of 16.3%.
Free Cash Flow Improvement
Free cash flow usage improved by 21% year-over-year, driven by a working capital investment and higher customer advances.
Continued Diversification and Growth in Services and Defense
Strategic expansions in Services and Defense segments, including new service centers and increased component repair capabilities.
Positive Outlook for Global 8000
Global 8000 aircraft is on track for delivery, with high demand due to its unmatched capabilities.
Debt Reduction Achievements
Net leverage improved by 0.6 turns or 17% versus Q1 of last year, with $400 million gross debt reduced in the last 12 months.
Negative Updates
Supply Chain Challenges
Ongoing supply chain challenges, including engine availability issues, impacting cost structure and margins.
Order Activity Stalling
Order discussions stalled around March due to economic uncertainty, resulting in a book-to-bill ratio of 0.9 times in Q1.
Pressure on Margins
Supplier-related costs and tariffs impacting margins, with a projection of continued headwinds throughout the year.
Potential Free Cash Flow Variability
Guidance for free cash flow shows a wide range of potential outcomes ($500 million to $800 million), dependent on order activity.
Company Guidance
During the Bombardier First Quarter 2025 Earnings Conference Call, the company provided strong guidance for the year despite ongoing geopolitical challenges. Bombardier expects meaningful increases in revenue, profitability, and free cash flow compared to 2024. Specifically, they anticipate revenues greater than $9.25 billion, with adjusted EBITDA exceeding $1.55 billion, reflecting a 19% revenue growth and a 21% rise in adjusted EBITDA to $248 million, leading to a margin of 16.3%. The company also forecasts delivering more than 150 aircraft, contributing to a book-to-bill ratio of 0.9 times in Q1. Free cash flow is projected between $500 million and $800 million, with a CapEx range of $200 million to $300 million. Bombardier's robust performance is supported by a stable $14.2 billion aircraft backlog and ongoing expansion in their Services and Defense segments, with Defense seeing strategic gains amidst geopolitical tensions.

Bombardier Financial Statement Overview

Summary
Bombardier shows strong revenue growth and improving profitability, with enhanced cash management. However, high leverage and negative equity are significant risks.
Income Statement
77
Positive
Bombardier's income statement shows a strong Gross Profit Margin of approximately 20.1% and an improving Net Profit Margin of 3.4% in the TTM period. The company has demonstrated consistent revenue growth over the past few years, with a notable increase from $6.91 billion in 2022 to $8.91 billion in the TTM. EBIT and EBITDA margins have also improved, indicating enhanced operational efficiency. However, net income has fluctuated, highlighting some volatility in bottom-line performance.
Balance Sheet
60
Neutral
The balance sheet reveals a high leverage situation with a negative stockholders' equity of approximately $-1.94 billion and a substantial total debt of $5.25 billion. The Debt-to-Equity Ratio is not meaningful due to negative equity, but the trend shows efforts in reducing debt levels. The Equity Ratio remains negative due to the persistent negative equity, posing a risk to financial stability. Despite these challenges, the company has managed to maintain a stable asset base.
Cash Flow
68
Positive
Operating cash flow has improved significantly to $477 million in the TTM, with a steady increase in free cash flow, reaching $315 million. This reflects better cash management and operational efficiency. The Operating Cash Flow to Net Income Ratio indicates strong cash generation relative to reported net income. Despite these improvements, fluctuations in free cash flow growth suggest some volatility in cash generation capabilities.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue8.66B8.05B6.91B6.08B6.49B
Gross Profit1.78B1.63B1.26B924.00M516.00M
EBITDA1.17B933.00M722.00M635.00M87.00M
Net Income370.00M445.00M-128.00M-249.00M-170.00M
Balance Sheet
Total Assets12.67B12.46B12.32B12.76B23.09B
Cash, Cash Equivalents and Short-Term Investments1.68B1.69B1.76B1.75B2.68B
Total Debt5.54B5.61B5.98B7.05B10.07B
Total Liabilities14.66B14.86B15.09B15.85B29.75B
Stockholders Equity-1.99B-2.40B-2.76B-3.09B-9.32B
Cash Flow
Free Cash Flow232.00M257.00M717.00M95.00M-3.19B
Operating Cash Flow405.00M623.00M1.07B332.00M-2.82B
Investing Cash Flow-164.00M118.00M-304.00M-89.00M967.00M
Financing Cash Flow-203.00M-438.00M-1.13B-3.21B1.71B

Bombardier Technical Analysis

Technical Analysis Sentiment
Positive
Last Price163.12
Price Trends
50DMA
109.83
Positive
100DMA
96.96
Positive
200DMA
97.07
Positive
Market Momentum
MACD
16.24
Negative
RSI
89.44
Negative
STOCH
96.26
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:BBD.B, the sentiment is Positive. The current price of 163.12 is above the 20-day moving average (MA) of 133.79, above the 50-day MA of 109.83, and above the 200-day MA of 97.07, indicating a bullish trend. The MACD of 16.24 indicates Negative momentum. The RSI at 89.44 is Negative, neither overbought nor oversold. The STOCH value of 96.26 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:BBD.B.

Bombardier Peers Comparison

Overall Rating
UnderperformOutperform
Sector (70)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
TSMDA
79
Outperform
C$4.85B48.368.54%49.98%108.76%
TSCAE
78
Outperform
$12.64B31.828.87%7.89%
73
Outperform
$16.23B42.35-18.58%16.31%4.12%
TSMAL
73
Outperform
C$1.05B26.145.12%1.09%8.59%242.80%
70
Neutral
¥170.86B10.684.42%3.06%5.63%-31.54%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TSE:BBD.B
Bombardier
163.12
66.95
69.62%
TSE:CAE
CAE
40.50
14.37
54.99%
TSE:MAL
Magellan Aerospace
18.02
9.78
118.69%
TSE:MDA
MDA Ltd
39.31
26.39
204.26%

Bombardier Corporate Events

Business Operations and StrategyFinancial Disclosures
Bombardier Reports Strong Q1 2025 Financial Performance and Positive Outlook
Positive
May 1, 2025

Bombardier Inc. reported significant financial growth in the first quarter of 2025, with revenues increasing by 19% to $1.5 billion, driven by additional aircraft deliveries and steady growth in its services sector. The company achieved a 21% rise in adjusted EBITDA, reflecting robust profitability and operational efficiency. Bombardier’s strategic focus on sustainable growth is evident in its improved free cash flow and strong backlog, positioning it well for future opportunities despite global economic uncertainties. The company’s positive 2025 guidance underscores its commitment to maintaining momentum and achieving long-term profitability.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 16, 2025