Jeffrey To
Long/short equity

Bombardier: An Unloved Stock Despite Strong Competitive Advantages And Cheap Valuation

Bombardier (OTCQX:BDRBF) (TSX: BBD.B) is a $6.4-billion company that specializes in two areas: the manufacturing of commercial, business, and amphibious planes; and the production of rolling stock. Bombardier Aerospace, with a $37.3-billion order backlog, is the third-largest aircraft manufacturer globally. Despite its ranking, Bombardier Aerospace's orders only represent a small fraction of the commercial aircraft industry- Airbus (OTCPK:EADSY) and Boeing (NYSE:BA) have €627 billion and $373 billion, respectively, in order backlogs. Conversely, Bombardier Transportation is the global leader in the locomotives industry, with "300-400 contracts under way at any given time." At Bombardier's 2011 high, shares were trading at $7.11. With shares currently trading almost 50% lower (and -20% YTD) due to the competitive...

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