Bombardier (TSX: BBD.B) had a pretty great last year. The company continued to see demand for its current and future aircraft, marking a strong performance during 2023. But is that set to continue? And if it does, could Bombardier stock offer the chance to achieve millionaire status?
More orders
So, what’s been driving the growth for Bombardier stock lately? The answer is orders — more and more of them. Most recently, the company received a firm order for 12 of its Challenger 3500 aircraft. These deliveries would start off in 2025, with the order at about US$326.4 million based on its prices for 2023.
The company’s business jet aircraft have been highly sought-after purchases during the last few years. However, it’s not the only one bringing in cash flow for the company.
As higher costs continue through inflation, but businesses want business jets, older models are now being purchased from Bombardier stock as well. So, the company is now seeing strong cash flow results that should continue at least through 2025.
Government expansion?
While business jets remain its focus, Bombardier stock hasn’t shied away from getting in on government action. The company continues to push the Canadian government to purchase its Global 6500 business jets for conversion into a spy plane prototype. While the Canadian government has not done this, the United States Army got on board.
The company is now hoping to start rolling off these aircraft in the early 2030s. The company also hopes that this will allow the Canadian government to change their mind in the near future as well.
While it’s unclear how many were purchased by the U.S., it’s nearly $75 million for new Global 6500 aircraft. So, just three could bring in $224 million!
Top analyst pick
Analysts continue to see the stock as one of the best options in 2024. The stock has been given an outperform rating again and again by analysts who now see a “material potential upside” as the company continues its strategy.
In fact, some analysts believe the stock could indeed double should it achieve its 2025 earnings before interest, taxes, depreciation and amortization (EBITDA) target of $1.6 billion. And as declining interest rates come into effect, the company should be a major beneficiary. Lower interest rates mean more orders. And more orders, of course, mean more cash.
The stock currently has the goal of achieving 140 unit sales for the year and looks to be well on the way. In fact, during its last quarter, it added another order of over 40 units, making it well on the way to achieving those results.
Bottom line
So, with two airlines currently providing significant means of growth for the future and plenty more plans, Bombardier stock could certainly make some investors millionaires, especially if analysts are right that the stock should double in share price within the next year. For now, shares remain at just $53 per share as of writing. While some have increased the price target to $103, the consensus remains at $78 as of writing. Yet even this provides a potential upside of 47% as of writing for today’s investor.
