AAR (NYSE:AIR) Announces Quarterly Earnings Results

Key Points

• AAR beat expectations: Q1 EPS was $1.25 versus the $1.21 consensus and revenue was $845.1M (vs. $812.6M estimated), and the stock jumped about 4.8% to $108.46 on the results.
• Analysts have raised targets and ratings—AAR has a consensus rating of "Moderate Buy" with a consensus price target of $119.60 after several firms lifted their objectives.
• Insiders have been net sellers (128,984 shares sold in the last 90 days, ~$12.5M), while institutional ownership is very high at about 90.74% following sizable stake increases by firms like Wellington, UBS and State Street.

AAR (NYSE:AIR - Get Free Report) announced its earnings results on Tuesday. The aerospace company reported $1.25 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $1.21 by $0.04, FiscalAI reports. AAR had a net margin of 3.17% and a return on equity of 12.40%. The firm had revenue of $845.10 million for the quarter, compared to analyst estimates of $812.58 million.

AAR Trading Up 4.8%

NYSE:AIR traded up $4.97 on Tuesday, reaching $108.46. 994,453 shares of the stock traded hands, compared to its average volume of 528,658. The company has a current ratio of 2.84, a quick ratio of 1.31 and a debt-to-equity ratio of 0.61. AAR has a 1-year low of $46.51 and a 1-year high of $121.64. The company's 50 day moving average is $109.60 and its 200-day moving average is $92.11. The firm 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

Several equities analysts have weighed in on the company. Royal Bank Of Canada lifted their price objective on AAR from $90.00 to $105.00 and gave the company an "outperform" rating in a report on Wednesday, January 7th. KeyCorp boosted their price target on AAR from $93.00 to $109.00 and gave the company an "overweight" rating in a research note on Wednesday, January 14th. Truist Financial reiterated a "buy" rating and set a $128.00 price objective (up from $107.00) on shares of AAR in a research note on Friday, March 6th. Wall Street Zen raised shares of AAR from a "hold" rating to a "buy" rating in a report on Saturday, February 21st. Finally, The Goldman Sachs Group began coverage on shares of AAR in a research report on Monday, January 26th. They issued a "neutral" rating and a $121.00 target price for the company. Four equities research analysts have rated the stock with a Buy rating and three have given a Hold rating to the stock. According to MarketBeat, AAR presently has a consensus rating of "Moderate Buy" and a consensus target price of $119.60.

Insider Activity

In related news, CAO Jessica A. Garascia sold 4,787 shares of the business's stock in a transaction 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 transaction, the chief accounting officer owned 29,557 shares in the company, valued at $2,815,304.25. The trade was a 13.94% decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available at this hyperlink. Also, SVP Christopher A. Jessup sold 23,621 shares of the company's stock in a transaction on Friday, January 9th. The shares were 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 in the company, valued at $6,382,881.45. This trade represents a 26.42% decrease in their position. The SEC filing for this sale provides additional information. In the last 90 days, insiders sold 128,984 shares of company stock valued at $12,517,090. Company insiders own 3.60% of the company's stock.

Institutional Inflows and Outflows

A number of hedge funds and other institutional investors have recently made changes to their positions in the business. Wellington Management Group LLP grew its stake in AAR by 144.3% during the third quarter. Wellington Management Group LLP now owns 1,486,775 shares of the aerospace company's stock worth $133,319,000 after purchasing an additional 878,188 shares during the period. Barrow Hanley Mewhinney & Strauss LLC grew its position in shares of AAR by 297.4% during the 4th quarter. Barrow Hanley Mewhinney & Strauss LLC now owns 594,668 shares of the aerospace company's stock worth $49,233,000 after buying an additional 445,026 shares during the period. UBS Group AG increased its stake in shares of AAR by 709.2% in the 3rd quarter. UBS Group AG now owns 488,239 shares of the aerospace company's stock valued at $43,780,000 after acquiring an additional 427,906 shares in the last quarter. State Street Corp lifted its position in shares of AAR by 17.1% during the 4th quarter. State Street Corp now owns 2,320,927 shares of the aerospace company's stock valued at $192,150,000 after acquiring an additional 339,595 shares during the period. Finally, Franklin Resources Inc. boosted its stake in AAR by 36.9% during the third quarter. Franklin Resources Inc. now owns 1,154,167 shares of the aerospace company's stock worth $107,752,000 after acquiring an additional 311,258 shares in the last quarter. 90.74% of the stock is owned by institutional investors and hedge funds.

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.

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