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PLEASE NOTE: One week from today, on January 24, 2014, shortly after the stock market closes at 4:00 p.m. Toronto time, we will reveal our #1 Aggressive Stock of 2014 to subscribers of Stock Pickers Digest. You can be among the first to hear about our #1 pick for 2014. Because you’re a loyal subscriber, we are happy to offer you a bargain-priced, no-risk introduction to Stock Pickers Digest. It gives you the first month—and the 2014 Stock of the Year—FREE. But you must act now. Click here. CAE INC., $14.10, Toronto symbol CAE, is our Stock of the Year for 2014. This is CAE’s third time as our #1 pick. It was our Stock of the Year in 2000, when it gained 130.0% for us. We picked it again for 2002, but 9/11 hurt air travel much more than we expected. Fuel prices also moved up, the economy weakened, and CAE dropped 54.2% that year....

CGI GROUP INC., $34.96, Toronto symbol GIB.A, is Canada’s largest provider of computer outsourcing services. It helps its clients automate certain routine functions, like accounting and buying supplies. That makes companies more efficient and lets them focus on their main businesses. The company is the lead contractor for the Healthcare.gov website, which lets Americans shop for health insurance plans under the Affordable Care Act (or Obamacare). Since the site began operating on October 1, 2013, visitors have had trouble logging on and evaluating the various health plans. As a result, fewer users than expected have signed up. These problems have prompted Massachusetts and Vermont to withhold scheduled payments to CGI. Other states may do the same or demand refunds. That’s mainly why the stock is down 7% in the past week....

BOMBARDIER INC. (Toronto symbols BBD.A $4.52 and BBD.B $4.50; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 1.8 billion; Market cap: $8.1 billion; Price-to-sales ratio: 0.4; Dividend yield: 2.2%; TSINetwork Rating: Average; www.bombardier.com) has won an order for five of its new CSeries passenger jets from Iraqi Airways. This client also has options to buy 11 additional planes.

The company now has 182 firm orders for the CSeries. If buyers exercised their options for 237 more planes, these orders would total roughly $32 billion U.S. Bombardier expects to begin deliveries by the end of 2014.

Bombardier B stock is a buy....

BOMBARDIER INC. (Toronto symbols BBD.A $4.52 and BBD.B $4.50; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 1.8 billion; Market cap: $8.1 billion; Price-to-sales ratio: 0.4; Dividend yield: 2.2%; TSINetwork Rating: Average; www.bombardier.com) has won an order for five of its new CSeries passenger jets from Iraqi Airways....

Canadian aerospace and transportation giant Bombardier is counting on the sales of its CSeries business jets to spur its growth. In September we reported on the new jet’s first successful test flight: click here to see the article. Here is our latest report on Bombardier’s progress from The Successful Investor. ...

BOMBARDIER INC. (Toronto symbols BBD.A $4.62 and BBD.B $4.57; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 1.8 billion; Market cap: $8.2 billion; Price-to-sales ratio: 0.4; Dividend yield: 2.2%; TSINetwork Rating: Average; www.bombardier.com) recently began test flights of its CSeries jet, which seats 100 to 150 passengers. The new CSeries is quieter and 20% more fuel efficient than comparable aircraft.

The company now expects the CSeries’ development costs to total $3.9 billion, up 14.7% from its original 2008 estimate of $3.4 billion (all amounts except share prices and market cap in U.S. dollars). That’s because new accounting rules, which took effect in 2011, have forced Bombardier to include interest costs in the overall estimate.

Bombardier now has firm orders for 177 CSeries jets, plus options for 226 more. If the buyers exercise all these options, the resulting 403 orders would be worth $29 billion. The company aims to begin delivering the planes by the end of 2014.
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MANITOBA TELECOM SERVICES INC., $29.00, Toronto symbol MBT, recently agreed to sell its Allstream subsidiary to a private company controlled by an Egyptian billionaire. Allstream provides integrated telephone, Internet and other communication services to over 50,000 businesses across Canada, as well as government agencies. Manitoba Telecom planned to contribute $130 million of the $405 million it would have received from the sale to its underfunded employees’ pension fund. However, Ottawa blocked the deal on national security grounds....

BOMBARDIER INC. (Toronto symbols BBD.A $4.62 and BBD.B $4.57; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 1.8 billion; Market cap: $8.2 billion; Price-to-sales ratio: 0.4; Dividend yield: 2.2%; TSINetwork Rating: Average; www.bombardier.com) recently began test flights of its CSeries jet, which seats 100 to 150 passengers....

Here’s another item in the series we started last week, about the way investors value individual stocks. Q: Pat: Bombardier has annual sales of $18 billion, earnings of $600 million and cash of $3 billion. CP Rail has sales of $6 billion, earnings of $1 billion, and cash of $442 million. Why then is Bombardier’s market cap of $9.3 billion so much lower than CP’s market cap of $26.0 billion? CP is just a random comparison, but I don’t understand why an international giant like Bombardier has such a low value....

Bombardier, $4.97, symbol BBD.A on Toronto; $5.25, symbol BBD.B on Toronto (Shares outstanding: 1.8 billion; Market cap: $9.3 billion; www.bombardier.com), is the world’s third-largest commercial aircraft maker, behind Boeing and Airbus. It is also the world’s leading passenger railcar manufacturer. Bombardier’s shares have moved up from $3 a share late last year, but are still trading below the high of over $7 they recovered to after the stock hit a low of just over $2 in early 2009 (along with stock markets in general) in the wake of the financial crisis. The company’s backlog now stands at a record $65.5 billion on June 30, 2013. The backlog is split evenly between aerospace at $33.4 billion, and transportation at $32.1 billion. The new CSeries is pushing the aerospace backlog higher, while transportation is virtually unchanged from a year earlier....