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  5. BDGI: I have be considering swapping CAE for BDGI. [Badger Infrastructure Solutions Ltd.]
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Investment Q&A

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Q: I have be considering swapping CAE for BDGI. Badger is widely exposed across the US while CAE seems to be slow getting traction at a time when business should be good.
What are your thoughts on these companies and their potential growth.

Thanks for the great service
Asked by Clarence on January 19, 2024
5i Research Answer:

BDGI has had decent momentum recently, as revenue growth and profitability recovered meaningfully are expected to remain solid in the near term due to a bounce in economic activities. BDGI is also priced quite reasonably, currently trading around 17.6x Forward P/E.

CAE’s momentum is currently not as great, but the fundamentals remain solid. We think the outlook for CAE's business remains solid, and it does have a very large backlog, while its valuation is at a lower end compared to historical averages. We think CAE’s fundamentals are overlooked by investors, but some patience is going to be required for the thesis to play out.
Overall, both are good companies, but this is not an apple-to-apple comparison. For new cash, we would be okay adding to BDGI, but we would not sell CAE at the current price to switch to something BDGI.