Aercap Holdings Intrinsic Stock Value – AerCap Holdings: Quality Compounder Trading Below Fair Value
January 4, 2024
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AERCAP ($NYSE:AER): AerCap Holdings is a quality compounder trading at a price below its fair value. It also provides management services such as fleet planning, maintenance, and remarketing. Despite its impressive track record, AerCap shares are currently trading at a discount to their historical average, making now an attractive time to invest in the stock. With a high-quality portfolio of aircraft assets and a continued focus on growth through acquisition and fleet renewal, AerCap is well positioned to continue to generate strong returns for investors in the coming years.
Price History
AerCap Holdings (NYSE:AER) has had a shaky start to the week following Tuesday’s 2.7% decline in its share price. The stock opened at $73.8 and closed at $72.4, below the previous closing price of $74.3. This has left AerCap trading below its fair value and presenting a good opportunity to investors looking to take advantage of its quality as a compounder. The company boasts a strong balance sheet and a diversified portfolio of aircraft and engines, as well as an experienced management team focused on unlocking long-term value.
AerCap also has a history of returning capital to shareholders through dividends and share buybacks, making it an attractive investment for those seeking income as well as capital appreciation. AerCap’s fundamental strength and proven ability to weather economic downturns makes it a great long-term investment. With the current stock trading below its fair value, now is an opportune time for investors looking to capitalize on the stock’s potential upside. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Aercap Holdings. More…
| Total Revenues | Net Income | Net Margin |
| 7.48k | 2.53k | 26.2% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Aercap Holdings. More…
| Operations | Investing | Financing |
| 5.41k | -3.01k | -1.06k |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Aercap Holdings. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 71.59k | 55.22k | 76.72 |
Key Ratios Snapshot
Some of the financial key ratios for Aercap Holdings are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 16.6% | 17.1% | 26.6% |
| FCF Margin | ROE | ROA |
| -2.5% | 7.6% | 1.7% |
Analysis – Aercap Holdings Intrinsic Stock Value
GoodWhale has analyzed AERCAP HOLDINGS‘s financials and our proprietary Valuation Line has calculated the fair value of AERCAP HOLDINGS share to be around $71.4. Currently, AERCAP HOLDINGS is trading at $72.4 – a fair price, though slightly overvalued by 1.4%. By using GoodWhale to analyze AERCAP HOLDINGS, investors can make informed decisions on their investments. More…
Peers
The company competes with other aviation leasing companies such as Air Lease Corp, CSSC (Hong Kong) Shipping Co Ltd, Willis Lease Finance Corp.
– Air Lease Corp ($NYSE:AL)
Air Lease Corporation, founded in 2010 and headquartered in Los Angeles, California, is an aircraft leasing company. The company leases aircraft to airlines around the world. As of December 31, 2020, Air Lease Corporation had a global fleet of 391 aircraft leased to 192 customers in 84 countries.
– CSSC (Hong Kong) Shipping Co Ltd ($SEHK:03877)
CSSC (Hong Kong) Shipping Co Ltd is a shipping company with a market cap of 7B as of 2022. The company has a ROE of 13.77%. The company’s primary business is the transportation of bulk commodities and general cargo. The company operates a fleet of vessels that includes bulk carriers, container ships, and general cargo ships. The company has a strong presence in the Asia-Pacific region and has a network of offices in China, Hong Kong, Singapore, and Taiwan.
– Willis Lease Finance Corp ($NASDAQ:WLFC)
Willis Lease Finance Corporation is engaged in the business of leasing commercial aircraft and engines to airlines, aircraft engine manufacturers and other aviation-related businesses worldwide. The Company’s primary leasing activities include acquiring aircraft and engines through purchase-and-leaseback transactions, leasing aircraft and engines directly to lessees and remarketing leased aircraft and engines. Its customers include major airlines, fractional ownership providers, cargo carriers, general aviation operators, commercial aircraft lessors and engine manufacturers. The Company’s lessees operate in over 50 countries. The Company’s equipment portfolio consists of over 190 engines and 60 aircraft.
Summary
Aercap Holdings is an aircraft leasing and financing company that trades at a discounted rate compared to its fair value. Its strong financials and large customer base make Aercap an attractive investment opportunity. Analysts suggest that the low stock price does not reflect Aercap’s true value, making it an attractive buy for long-term investors. The company pays dividends to shareholders, and its recent acquisitions and expansions have resulted in a steady growth in revenue and profits.
Aercap also has a track record of successfully managing its debt, resulting in a very strong balance sheet and consistent cash flow. These factors make Aercap a great option for the long-term investor looking for a quality compounder at a discounted rate.
