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Research Alert: Bbd Q1: Fy 26 Fcf Guided >$1b As Services Drive Growth And Margins Compress

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-- CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:

BBD reported Q1 revenues of $1,599M, up 5%, driven by Services growth of 25% to $617M and 24 deliveries, with adjusted EPS reaching $1.81 vs. $0.61 in the prior year. However, adjusted EBITDA declined 1% to $246M with margin compression of 90 bps to 15.4%, while EBIT decreased 6% to $167M. The company achieved a strong unit book-to-bill ratio of 3.6x driven by fleet operator demand and Global 8000 aircraft interest, resulting in backlog growth to $20.3B, up 43%. Management raised FY 26 free cash flow guidance to greater than $1.0B from the previous $600M-$1.0B range while reaffirming all other metrics. Free cash flow generation reached $360M compared to usage of $304M in the prior year, with leverage improving to 1.8x following CAD150M debenture repayment. We believe the Global 8000 demand trajectory aligns well with constructive market conditions, and the raised FCF guidance suggests supply chain issues are being managed effectively.

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