Topic: How To Invest

The Successful Investor Hotline – Friday, May 22, 2020

Article Excerpt

CAE INC., $19.00, 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 30 countries and makes mannequins and other medical-simulators for training health professionals. The COVID-19 outbreak has hurt demand for flight simulators. CAE has also closed a third of its pilot-training schools. As a result, overall revenue for the fiscal 2020 fourth quarter, ended March 31, 2020, fell 4.4%, to $977.3 million from $1.02 billion a year earlier. That missed the consensus forecast of $1.02 billion. Despite the COVID-19 disruptions, CAE’s civilian aviation business (62% of its total revenue) still saw revenue rise 1.4% in the quarter. However, revenue at the military division (35%) declined 11.9% as shelter-in-place orders made it harder for government officials to authorize new contracts. As well, revenue at the health-care division (3%) fell 17.4% as the lockdown of medical schools slowed…

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