BBD.B, Bombardier


Bombardier has a “compelling valuation” according to an RBCDS analyst. There are now 20 buys against 2 sells, quite a turnaround in sentiment that had been unreservedly negative, almost comparable to RIM. By the way, this stock now has a capitalization of around 6 bln, well below RIM’s. It yields almost 3%, trades at a of 7 and has lost half its value in the last year, and almost all of it over the past 10 years.

The company recently won another 700 mln. order from Stuttgart’s transit system and is virtually the only company left making trains. Same thing with the medium sized jets even if they share that position with the Brazilians. These things are simple not going to go out of fashion any time soon. Anyone who has seen John Candy’s movie “Planes, Trains & Automobiles” will know how important and durable these things are, Bombardier covers 2/3 of them.

The EW patterns are not clear. A large A-B-C correction from $26 to $2 could have been it. If so the stock is in a new bull market since then but the patterns are not clear. What is clear is that the stock is pretty close to the 20+-year line that connects all bottoms. Perhaps a good time to buy? See also previous entries for this stock!