Topic: How To Invest

The Successful Investor Hotline – Friday, March 5, 2021

Article Excerpt

CAE INC., $38.70, Toronto symbol CAE, is still a buy for long-term gains. The company generates value for investors as a leading maker of flight simulators for commercial and military aircraft. It also operates pilot-training schools in over 35 countries and makes mannequins and other medical-simulators for training health professionals. The stock jumped 10% this week after CAE agreed to buy 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 provides flight training services to the U.S. Air Force. CAE will pay $1.1 billion U.S. for these businesses when it completes the purchase, likely in the second half of 2021. The company expects eliminating overlapping operations will reduce its annual costs by $35 million to $45 million (Canadian) by the end of the second year. To put those amounts in context, CAE earned $60.0 million, or $0.22 a share, in the quarter ended December 31, 2020. To help…