Bombardier, maker of planes and trains and other things Message Board

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Gold/Mining/Energy : Bombardier, maker of planes and trains and other things

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To: Jay Anderson who wrote (859)	2/9/2001 3:01:29 PM
From: Carpe per Diem	of 1177

Thanks Jay, I missed that and you are correct. Most, if not all media outlets, give PE ratios in relation to trailing earnings...this makes sense because "this years" earnings aren't necessarily in the bag...it's based on "projected" earnings. BBD is currently trading at 37 times trailing earnings...I'm not sure I agree with the author there is room for expansion of BBD's PE. Historically, BBD has traded under 30 times trailing earnings and only this year did they run up into the 30's and touched the 40's for a while...and deservedly so...there growth in earnings relative to the enormous size of BBD is remarkable. However, I think they have reached a PE ceiling so to speak...and future gains in BBD's share value will be driven by growth in earnings, and not the expansion of BBD's PE multiple. Still, when earnings are growing at 30%, and that translates into a 30% appreciation in share value (barring a PE contraction), that's plenty enough reason for me to stay very long on BBD.

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