Rising air travel volumes will spur CAE

Article Excerpt

Airlines are now spending more on simulators and pilot training as travel volumes return to pre-pandemic levels. That’s good news for CAE, which has about 30% of the pilot-training market. The company also continues to expand its military businesses; that cuts its exposure to the cyclical airline industry. All together, those factors should continue to push CAE’s earnings and let it re-instate its dividend. CAE INC. $32 remains a buy. The company (Toronto symbol CAE; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 318.5 million; Market cap: $10.2 billion; Price-to-sales ratio: 3.0; Dividend suspended in March 2020; TSINetwork Rating: Average; www.cae.com) is a leading maker of flight simulators for commercial and military aircraft. It also operates pilot-training schools in over 35 countries and makes medical-simulators for training health professionals. In July 2021, CAE paid $1.05 billion U.S. for the military training operations of U.S.-based L3Harris Technologies Inc. (New York symbol LHX). This business makes simulators for military aircraft, unmanned drones and submarines. It also…

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