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Breaking down the balance sheet of Bombardier (TSX:BBD.A)

Canadian Stock News Cantech

In 1937, a Quebec mechanic named Joseph-Armand Bombardier dreamed of dreamed of building a vehicle that could “float on snow.” A few years later schoolchildren in rural parts of that province were among the first people in the world to ride snowmobiles, which began as large, multi-passenger vehicles. By the time of Bombardier’s death in 1964, his eponymous Company had sales of $20 million. Bombardier’s later ventures into aerospace and railway grew the company to the internationally recognized giant it has become. Despite it size, Bombardier is still putting up double digit growth. We break down the numbers to see if The Company offers value to investors after all these years.

1. Price to sales: 0.42 x sales

As of January 31st, 2010 (Q3 2011) Bombardier had 1.73 billion shares
outstanding. The price as of May 14th, 2010 was $5.39 This gives The Company a market capitalization of $9.32 billion. Sales in the trailing four quarters totaled $21.68 million.

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2. Cash to Market Cap: 36.1%

As of Q3 2011, Bombardier’s reported cash and short term investments totaled $3.37 billion. The Company’s market cap, as of May 14th, 2010 was $9.32 billion.

3. Debt to market Cap: 44.6%

As of Q3 2011 The Company’s reported long term debt was 4.16 billion. The Company’s market cap, as of May 14th, 2010 was $9.32 billion.

4. Trailing Three year growth rate: 10.1%

Sales totaled $13.25 billion in 2006. The sales grew to $17.5 million in 2010.

5. Enterprise Value to Sales: 0.46 x sales

Enterprise Value as of Q3 2010 is $2.36 billion, based on a
market cap of $5.47 billion plus zero long term debt, minus cash
and short term investments of of $3.11 billion. Sales for the trailing four quarters totaled $10.94 billion.

All financial information about Bombardier is gleaned from
their filings with the System for Electronic Document Analysis and
Retrieval (SEDAR)
All calculations are based on The Company’s closing share price as of
close May 14th, 2010: $5.39
Sales from trailing four quarters: $21.68 million
Cash and short term investments as of February 28th, 2010: $3.37 billion
Shares outstanding: 1.73 billion

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About The Author /

Cantech Letter founder and editor Nick Waddell has lived in five Canadian provinces and is proud of his country's often overlooked contributions to the world of science and technology. Waddell takes a regular shift on the Canadian media circuit, making appearances on CTV, CBC and BNN, and contributing to publications such as Canadian Business and Business Insider.
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