Shares in Bombardier (TSX:BBD.b)and CAE (TSX:CAE)both hit new 52-week lows Tuesday as investors reacted to negative developments hitting the airline industry in general and the companies in particular.
Shares of Bombardier closed at $3.05, down 20 cents on the day. That broke the previous 52-week low of $3.13 set last October. It's also the lowest price for the stock in more than eight years.
The latest blow came Tuesday, when Bombardier rival Embraer cut its forecast for commercial jet deliveries for this year and next. Swiss International Airlines also slashed its Embraer jet order from 60 planes to 30.
That was the first major cutback in regional jet orders and led investors in Bombardier to worry that the Canadian company will have similar bad news to report.
On Monday, Moody's Investor Services cut its rating on Bombardier's debt, citing the precarious financial picture of many of the world's airlines. The Standard & Poor's agency cut its rating on the company earlier in the month.
- FROM Mar. 3, 2003: Bombardier laying off 3,000 workers at aerospace division
- FROM March 15, 2003: Bombardier's de Havilland workers ratify deal; agree to layoffs
CAE shares have fallen 75 per cent in a year
CAE shares closed down 24 cents to $3.18, breaking through the previous 52-week low of $3.25.
Broker Raymond James on Monday downgraded CAE shares to "underperform" and slashed its price target from $6 to $3, citing expected weakness in pilot training revenue.
- FROM Mar. 19, 2003: CAE withdraws debenture offering after shares dive