AAR (NYSE:AIR) Announces Quarterly Earnings Results, Beats Estimates By $0.04 EPS

AAR (NYSE:AIR) issued its quarterly earnings results on Tuesday. The aerospace company reported $1.25 earnings per share for the quarter, beating analysts’ consensus estimates of $1.21 by $0.04, FiscalAI reports. The firm had revenue of $845.10 million during the quarter, compared to the consensus estimate of $812.58 million. AAR had a net margin of 3.17% and a return on equity of 12.40%. The business’s revenue was up 24.6% on a year-over-year basis. During the same period in the prior year, the firm earned $0.99 EPS.

Here are the key takeaways from AAR’s conference call:

• AAR delivered strong quarterly results with 25% total sales growth, ~25–31% increases across adjusted operating income, EBITDA and EPS, and generated $75 million of operating cash, leaving net leverage at 2.17x.
• Parts distribution led performance with 36% organic growth in new parts distribution (62% total), while the ADI acquisition outpaced expectations and was accretive to margins; government distribution grew 55% organic.
• The HAECO Americas integration is progressing ahead of schedule but caused near-term margin dilution (management calls the quarter the low point); they are rightsizing revenue and costs and expect margins to recover by Q3 FY2027.
• Trax software showed strong momentum — record quarter, Delta deployment increased to ~2,000 users with ~6,000 expected in coming months, and AAR plans to launch a parts marketplace this calendar year to drive recurring revenue.
• Management raised its outlook, now expecting ~19% total sales growth for the year and ~12% organic growth, sees Q4 adjusted sales up 19%–21% with operating margin ~10.2%–10.5%, and will host an investor day on May 12 to outline strategy.

AAR Price Performance

NYSE:AIR opened at $108.46 on Wednesday. The company has a debt-to-equity ratio of 0.61, a quick ratio of 1.31 and a current ratio of 2.84. The company has a 50-day moving average of $109.82 and a 200-day moving average of $92.34. AAR has a 52 week low of $46.51 and a 52 week high of $121.64. The company has a market capitalization of $4.29 billion, a price-to-earnings ratio of 42.53 and a beta of 1.19.

Analysts Set New Price Targets

A number of research analysts have recently commented on the stock. KeyCorp upped their price objective on shares of AAR from $93.00 to $109.00 and gave the company an “overweight” rating in a research report on Wednesday, January 14th. Jefferies Financial Group reissued a “buy” rating on shares of AAR in a research report on Tuesday. Zacks Research lowered AAR from a “strong-buy” rating to a “hold” rating in a research note on Monday, March 16th. Weiss Ratings reaffirmed a “hold (c-)” rating on shares of AAR in a report on Monday, December 29th. Finally, Royal Bank Of Canada raised their price objective on AAR from $90.00 to $105.00 and gave the stock an “outperform” rating in a research report on Wednesday, January 7th. Four analysts have rated the stock with a Buy rating and three have assigned a Hold rating to the stock. Based on data from MarketBeat, the company presently has an average rating of “Moderate Buy” and an average target price of $119.60.

Insider Buying and Selling at AAR

In other AAR news, SVP Christopher A. Jessup sold 23,621 shares of AAR stock in a transaction that occurred on Friday, January 9th. The stock was sold at an average price of $97.05, for a total transaction of $2,292,418.05. Following the sale, the senior vice president directly owned 65,769 shares of the company’s stock, valued at approximately $6,382,881.45. The trade was a 26.42% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this link. Also, CAO Jessica A. Garascia sold 4,787 shares of the company’s stock in a transaction that occurred on Thursday, January 8th. The shares were sold at an average price of $95.25, for a total value of $455,961.75. Following the completion of the sale, the chief accounting officer owned 29,557 shares in the company, valued at approximately $2,815,304.25. This represents a 13.94% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. In the last three months, insiders sold 128,984 shares of company stock worth $12,517,090. Insiders own 3.60% of the company’s stock.

Institutional Trading of AAR

Institutional investors have recently bought and sold shares of the stock. Aster Capital Management DIFC Ltd boosted its position in AAR by 1,287.5% in the fourth quarter. Aster Capital Management DIFC Ltd now owns 1,332 shares of the aerospace company’s stock valued at $110,000 after buying an additional 1,236 shares in the last quarter. Smartleaf Asset Management LLC increased its holdings in shares of AAR by 12.2% during the fourth quarter. Smartleaf Asset Management LLC now owns 1,162 shares of the aerospace company’s stock worth $97,000 after buying an additional 126 shares in the last quarter. Quadrant Capital Group LLC increased its holdings in shares of AAR by 778.0% during the fourth quarter. Quadrant Capital Group LLC now owns 2,072 shares of the aerospace company’s stock worth $172,000 after buying an additional 1,836 shares in the last quarter. Cibc World Markets Corp bought a new position in shares of AAR in the fourth quarter valued at approximately $214,000. Finally, CIBC Private Wealth Group LLC bought a new position in shares of AAR in the fourth quarter valued at approximately $84,000. Institutional investors and hedge funds own 90.74% of the company’s stock.

About AAR

AAR Corp. (NYSE: AIR) is a global provider of aviation products and services to commercial, government and defense customers. The company offers a comprehensive portfolio of maintenance, repair and overhaul (MRO) solutions, component repair and overhaul, and engineering services designed to support a wide variety of fixed-wing and rotary aircraft. Leveraging FAA and EASA certifications, AAR delivers turnkey maintenance programs and ad hoc repair services that enhance aircraft availability and reliability.

In its Aviation Supply Chain Services segment, AAR sources, stores and distributes parts for both commercial airlines and military operators.