On October 23, TD Cowen analyst Tim James reaffirmed a Hold rating for Bombardier’s stock (BDRBF). This decision reflects a cautious assessment of Bombardier’s performance and valuation.
Bombardier’s Current Valuation
James noted that while Bombardier has shown robust performance in the third quarter, stock valuation is a critical factor. The stock’s valuation multiples have expanded recently, indicating that it is currently fairly priced.
Financial Performance Overview
Key highlights from Bombardier’s financials include:
- Strong projected performance for the fourth quarter.
- Positive revenue growth and free cash flow.
- A shift towards larger cabin aircraft, enhancing market position.
Despite these positives, Bombardier has reported some modest shortfalls in margin and adjusted EBITDA against expectations. The company’s guidance for 2025 remains steady, suggesting stable future cash flow and EBITDA growth.
Market Expectations
James points out that the recent increase in Bombardier’s share price has created elevated expectations. Currently, the stock is valued at 11 times forward EBITDA, which solidifies the rationale for maintaining a neutral stance rather than issuing a buy recommendation.
Comparative Ratings
In a similar analysis issued on the same day, another analyst reaffirmed a Hold rating with a price target of C$204.00. The stock has seen a dramatic price fluctuation over the past six months, rising from C$81.460 to C$197.420. This represents a staggering 142.35% increase.
Overall, adequate caution is advised as Bombardier’s stock approaches an equilibrium point in its valuation, reinforcing the Hold rating given by analysts.
