Canada is looking into a brave new world where it spends a lot more money on defense than it ever used to. Despite this, Canadian aerospace stock Bombardier (TSE:BBD.B), is not seeing a whole lot of new benefit. A military spending surge and word of an even faster private jet proved a yawn to investors, as shares dropped over 1.5% in Monday morning’s trading.
Currently, reports note, the Canadian government is floating the idea of upping its defense spending by C$30.9 billion, or roughly $22.324 billion USD. Though, it will be hiking this spend over the course of four years. The word came out of Canadian Prime Minister Mark Carney, who noted that the big new ask was done with protection against “…America’s threats to our very sovereignty” in mind. The threats in question refer here to recent “threats” on the part of President Donald Trump to annex the country with a mind to making it the 51st state.
How Carney plans to respond to Alberta’s interest in doing perhaps that voluntarily, however, is a bit less clear. But with the United States looking at a big new spend of its own in defense—going up to a whopping $1 trillion—Canada’s move becomes a bit questionable in response.
Fastest Private Jet on Earth
Bombardier, meanwhile, is making a new play in private jets as well, just in case Canada’s big new military spending spree does not quite get down to Bombardier’s own wallet. In fact, it is set to offer up the fastest private jet on Earth with the Global 8000.
The Global 8000 is now the second-fastest civilian aircraft on Earth. With a top speed of Mach 0.94, that puts it just a hair under the Concorde, which, given that the Concorde shut down in 2003, left a bit of a hole in the market. Most civilian jets topped out at between Mach 0.8 and Mach 0.9, but the Global 8000 looks to shatter that record. With a range of 8,000 nautical miles and the potential to go full-on supersonic—though regulations set a speed limit of Mach 0.94 on private jets, the Global 8000 did test all the way to just past Mach 1—the Global 8000 might be a big new draw for the busy rich.
Is Bombardier Stock a Good Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on TSE:BBD.B stock based on six Buys and three Holds assigned in the past three months, as indicated by the graphic below. After a 45.21% rally in its share price over the past year, the average BBD.B price target of C$112.19 per share implies 36.27% upside potential.
