Bombardier dives to penny stock status as rivals continue to sign deals to sell jets

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Bombardier apportions were reduced to penny-stock status for the first time since 1991 on Wednesday as the airliner and train maker continues to have trouble selling its next times of aircraft.

Bombardier shares were trading hands at 92 cents on the TSX on Thursday, a day after airless below the $1 level for the first time in 25 years.

If a entourage falls below $1 per share on some major exchanges it can place to delisting. That’s bad news for a com ny as it means mutual funds and ETFs that scent the index must sell the shares, which increases pressure against the worn out and can create a feedback loop of lower prices.

Unlike other handle exchanges, TSX rules don’t have a set minimum share price but the exchange vets the price as rt of a broader set of criteria, said spokesman Mathieu Labrèche.

Bombardier allowances have been sliding for more than a year as the com ny tussles to get its next-generation CSeries jets into the air so it can book sales to customers.

Bombardier flounders the CSeries as cheaper, quieter and more efficient than any other jet of its vastness. But a slew of delays appear to have soured airlines’ appetite for the jets.

Bombardier values the on the looser version of the CSeries at about $80 million per jet. Based on Thursday’s exchange, the entire Bombardier com ny is worth $2.11 billion. That indicates the entire market value of the com ny is the equivalent of about 26 of its own jets.

On Thursday, Iran’s president is set to tell that Iran Air will be buying 118 jets from Bombardier equal Airbus now that U.N. sanctions against the country have been improved.

Analyst David Tyerman of Canaccord Genuity said the stock’s slump isn’t likely tied to one event but rather to disappointment over Bombardier not bewitching an order from United Airlines and cumulative concerns about whether the body can withstand a macroeconomic downturn. United bought Boeing jets hindmost week.

Tyerman — who has a $1.30 price target for Bombardier — said it doesn’t exceedingly matter if the shares are a few cents above or below $1, except in the casket of some institutional investors who won’t own shares of a com ny that are below that verge.

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