Bombardier Inc (B) (BBD.B.TO)

Airbus bought the C-series program. Does that mean all profits from it don’t go to BBD.B-T? There will be some profits accrue to BBD but not what we thought they would be. They got diluted down for nothing. They made a 61 plane announcement and that was constructive to the stock. He has been away since 9/11 because the stock has been too volatile.

Has nothing but negative things to say about this. If you are a trader, you can probably make money but if you are a longer-term investor, it is difficult to look at this company and build a case as to why, as a business, they are going to grow. This is a business that would not exist if the government were not giving them large financial handouts. There isn't any clear path as to how this company is going to grow.

To him, the preferreds would be considered a high yield debt, so for that portion of your portfolio, you are probably OK. He would be hard pressed to envision this company filing for bankruptcy in the next couple of years, when the Government, especially the Québec government, always seems to have their back. Probably a safer way than playing the stock.

(A Top Pick Oct 26/16. Up 54.05%.) Sold his holdings recently. Feels it could continue to run, but it is fairly speculative, and you have to be careful. A volatile stock.

Just bought this today. A fantastic situation. They are producing a magnificent plane which Boeing (BA-N) can’t produce. Airbus has stepped in, so this will now be sold to the world.

Seasonally, this is beyond the period of seasonal strength. The peak period you want to be in for industrial stocks is between March 6 and June 11, which produces an average return above the S&P 500 of about 9.05%, and has been positive in about 15 of the past 19 periods. Currently, it is starting to break down. The headlines do not help the stock. Technically, it seems to be developing a Head and Shoulders pattern, which implies lower Highs ahead. There is really no reason to hold this.

He can think of absolutely no reason to ever own this stock. The #1 corporate bum company in Canada. If you take away its gifts of money, subsidies, cheap loans and favouritism, he doesn’t understand why they exist.

Complaints against this company will go on for years. They have giant contracts which never really made much money, and have now actually been shut out of an important New York contract. It is really difficult for them to get going.

He is not at all interested in buying this name. The debt level is enormous. They are late to the game in getting planes out to customers. The rail division has been a disaster. He doesn’t like management or what they have done.

Move on to a faster growing company to do much better. They have had a lot of issues with production, finance and so on.

Chart shows this is in a very distinct upward trend, and testing its high at around $2.70-$2.80. Because the trend is positive and because the stock, relative to the TSE composite, is positive for the last few weeks, the preferred strategy is to stick with the stock for now.

Not an investment, a speculation. They’ve built very good products. The C series is a good jet and is selling, but have spent a lot of money on it. The current issue is the engine supplier, United Technologies, which is being plagued by the engine they are supplying to the Airbus 320. It is backing up the whole system, so Bombardier can’t deliver as many planes as they would like. Also, has way too much debt and spend a lot of money developing new products. It is really short of cash.

This has had a nice pull up in the last little while. Historically it has done very well as we get closer to the Paris air show, June 19-25 this year. There is anticipation that they are going to have additional sales at the air show. Historically, the stock does sell off after the air show.

Something he would never have touched in the 1^st place. It is weak competitively. They’ve not had a fresh order for their C series aircraft in over a year. Very highly leverage with about $10 billion of debt on the balance sheet, and only about $1 billion of EBITDA to support that. $2 is a pretty important support level. If that holds, it might be okay, but if it cracks it doesn’t look like there is much support all the way down to $1.60.

The problem with this is that there is a massive hole on the balance sheet, even after raising $1.6 billion. That’s about equal to the amount of money they blew through in the last 5 quarters. There is about $4 billion of negative equity on their balance sheet, along with $8 billion of debt, some of which is rolling over next year. You don’t really know if they are making money on their planes. The board is still stacked with family members and insiders.