Bombardier (TSX: BBD.B) came into the limelight on September 8 after US President Donald Trump singled out the company as the US-Canada trade war escalated. However, not much has changed since the Trump threat debacle. Trump’s concerns that Bombardier should make in America are already fulfilled. Bombardier employs thousands of people in Wichita, where it has its US headquarters. In fact, it opened a US$50 million learning centre on October 15 to train newly hired aircraft technicians and mechanics to support customers across its American service network.
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A 17% drop made Bombardier a bargain candidate
Despite Trump’s threat to ban Bombardier’s planes in America, the latest round of retaliatory tariffs on Canadian goods excluded the aerospace sector. This eases fears that Bombardier could face restricted access to its largest market, from which it earns about half its revenue.
Bombardier has been working uninterruptedly amidst the geopolitical tensions. It might set another example of how the noise does not affect the company’s strong fundamentals. Let’s see how.
Bombardier’s stock price fell 17% in August and September amidst uncertainty around the trade talk outcome. With the final verdict out and the aerospace sector excluded from the tariff basket, Bombardier will continue to enjoy free trade.
Even during uncertainty around the July 1 renewal of the Canada-United States-Mexico Agreement (CUSMA), Bombardier’s order book continued to grow from US$17.5 billion at the end of December 2025 to US$21.8 billion as of June 30, 2026. Its stock rose 36% in the first half of 2026. Behind the strong order book is increasing industry flight hours in the Americas region, Europe, the Middle East and Africa (EMEA) region, and the Asia-Pacific region.
The upcoming third-quarter earnings on November 5 will shed some light on how Bombardier is managing US uncertainty.
So far, Bombardier has repaid debt up to November 2030, which has improved its financial flexibility to tackle macroeconomic uncertainty. It is focused on defence aircraft and orders for new Global 8000 aircraft. The company knows that new aircraft revenue growth will slow. Hence, it has been expanding its defence aircraft, pre-owned aircraft, and aircraft maintenance and repair services. It aims to earn 50% of its revenue from these services by 2030, opening room for dividends.
Why is Bombardier stock still a buy?
Bombardier’s stock still has room to grow as pre-owned business jets available for sale as a percentage of the total in-service fleet dropped to 6.5% in June 2026 from 7.1% in June 2025. For Bombardier’s Global aircraft models, this percentage has dropped to 4.5% from 6.5%, hinting that the business jet market has capacity to buy new jets.
Considering how Bombardier is seeing a growing order book, the company has its hands full for the next two years. Certainty in an uncertain market deserves a premium. The stock is trading at a forward price-to-earnings (P/E) ratio of 21.1x, the lowest since December 2025.
Third-quarter earnings per share (EPS) is relatively flat compared to second-quarter earnings as aircraft inventory shoots up in the run-up to end-of-year deliveries. With debt falling and an increasing mix of Global 8000 aircraft in its revenue, profit margins are likely to increase. I am optimistic that Bombardier will beat its EPS.
The entry plan for Bombardier
I expect Bombardier’s long-term stock price growth prospects to slow by 2030 when new aircraft demand starts slowing. At that time, its management could consider announcing dividends as a primary way of giving returns to shareholders. You still have two to four years to enjoy growth and build wealth.
Investors can consider buying Bombardier stock at the current dip as macro noise does not impact Bombardier’s fundamentals. Its stock has the potential to grow 50-60% over the next 12 months. Those who already own the stock may consider holding it till June 2027 and review it every year. Keep an eye on the management’s capital allocation policy as it reduces its leverage ratio to 1.6x. The management might shift capital allocation towards share buybacks and mergers and acquisitions to generate growth.
