Bombardier's Railway Sale Boosts 1Q Profit

Bombardier Inc (BBD.B) posted a 43% increase in first-quarter adjusted profit on Thursday, primarily driven by a favorable mix of large-cabin aircraft deliveries and cost structure improvements. Bombardier’s revenue came Read More... The post Bombardier's Railway Sale Boosts 1Q Profit appeared first on TipRanks Financial Blog.

Bombardier's Railway Sale Boosts 1Q Profit

Bombardier Inc (BBD.B) posted a 43% increase in first-quarter adjusted profit on Thursday, primarily driven by a favorable mix of large-cabin aircraft deliveries and cost structure improvements.

Bombardier’s revenue came in at $1.34 billion for the quarter ended March 31, down from $1.52 billion in the prior-year quarter. It included revenues from its aerostructure and commercial aircraft operations which it sold last year. Business aircraft revenue was $1.3 billion in 1Q 2021, up 18% from 1Q 2020.

Meanwhile, the business jet maker reported a net income of nearly $5.1 billion ($2.03 per diluted share) in the first three months of 2021, compared to a net loss of $200 million ($0.11 per share) in the prior-year quarter. Profit was boosted by Bombardier’s sale of its railway activities to French company Alstom S.A.

On an adjusted basis, which excludes the $5.3-billion gain on the sale of the rail business, Bombardier lost $173 million ($0.07 per share), compared with an adjusted net loss of $182 million ($0.08 per share) a year ago.

Bombardier President and CEO Éric Martel said, "In our first quarter as a pure-play business aviation company, Bombardier delivered solid financial performance. This includes growth in business jet revenues, margin expansion, and significantly improved cash performance. We also continue to make strong progress on each of our strategic priorities: maturing the Global 7500 aircraft program, delivering on our productivity initiative, executing our aftermarket growth strategy, and deleveraging our balance sheet – setting the foundation for a more resilient and profitable business.”

Bombardier delivered 26 jets in January, February, and March. The company said it remains on track to deliver between 110 and 120 business jets in 2021. (See Bombardier Inc stock analysis on TipRanks)

Earlier this week, CIBC analyst Kevin Chiang maintained a Sell rating on BBD.B, but raised its price target to C$0.80 from $0.50, for a 10.6% downside potential.

Overall, the consensus on the Street is that BBD.B is a Hold based on 2 Buys, 5 Holds, and 2 Sells. The average analyst price target of C$0.87 implies a 2.2% downside potential to current levels.

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Magna Posts Better-Than-Expected 1Q Results, Profit More Than Doubles

Magna International (MG) beat earnings and revenue estimates in its first quarter, fueled by strong demand for car structures in China. Magna’s total revenue for 1Q 2021 came in at Read More... The post Magna Posts Better-Than-Expected 1Q Results, Profit More Than Doubles appeared first on TipRanks Financial Blog.

Magna Posts Better-Than-Expected 1Q Results, Profit More Than Doubles

Magna International (MG) beat earnings and revenue estimates in its first quarter, fueled by strong demand for car structures in China.

Magna’s total revenue for 1Q 2021 came in at $10.18 billion, an increase of 17.5% from a revenue of $8.66 billion reported in 1Q 2020. In addition, it beat estimates of $9.53 billion. The rise in sales came as global light vehicle production rose 18%, thanks to an 87% increase in China.

Meanwhile, the Canadian auto parts maker reported a profit of $615 million ($2.03 per diluted share) in 1Q 2021, up 136% from $261 million ($0.86 per diluted share) in 1Q 2020. A strong recovery in the global automotive sector and massive growth in the Chinese market boosted profit.

On an adjusted basis, Magna earned $1.86 per share for its most recent quarter compared with an adjusted profit of $0.86 per share in the prior-year period. Adjusted profit was higher than analysts' expectations of $1.57.

Magna’s CEO Swamy Kotagiri said, "We generated strong earnings in the first quarter of 2021 despite industry supply constraints that impacted OEM production schedules. We expect supply constraints to continue through at least the second quarter. As we look past the near-term industry headwinds, we see considerable growth opportunities for Magna in the coming years."

Magna slightly raised its full-year revenue forecast of $40.2 billion to $41.8 billion, compared to its earlier revenue expectations of between $40.0 billion to $41.6 billion. (See Magna International stock analysis on TipRanks)

Last week, BMO Capital analyst Peter Sklar reiterated a Buy rating on MG with a price target of $99.00 (C$121.31) for a 3.3% upside potential.

Overall, MG scores a Strong Buy consensus rating among analysts based on 9 Buys and 3 Holds. The average analyst price target of C$128.67 implies a 9.6% upside potential to current levels.

On top of that, Magna scores a 9 out of 10 on TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform the overall market. Shares have risen by approximately 30% year-to-date.

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The post Magna Posts Better-Than-Expected 1Q Results, Profit More Than Doubles appeared first on TipRanks Financial Blog.

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