Yahoo Finance Why Is Air Lease (AL) Down 3.2% Since Last Earnings Report?
It has been about a month since the last earnings report for Air Lease (AL). Shares have lost about 3.2% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Air Lease due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Q1 Earnings Miss
Air Lease reported lower-than-expected first-quarter 2024 results wherein both earnings and revenues lagged the Zacks Consensus Estimate.
AL’s quarterly earnings per share (excluding 44 cents from non-recurring items) of $1.31 fell short of the Zacks Consensus Estimate of $1.49. Results were hurt by high expenses. Quarterly earnings, however, improved 23.6% on a year-over-year basis.
Total revenues of $663.3 million lagged the consensus mark of $682.4 million. Air Lease, which leases planes to airline companies, is struggling with delivery delays from plane manufacturers. The top line improved 4.27% year over year, owing to continuous growth in the company’s fleet.
Other Statistics
Revenues from the rental of flight equipment edged down 0.6% year over year to $614.3 million in the reported quarter. Revenues from aircraft sales, trading activity and other sources surged in excess of 100% from the year-ago quarter to $49 million. Operating expenses increased 10.5% year over year to $528 million. High interest expenses led to the uptick in operating costs. AL made high interest payments on funds borrowed to finance aircraft buys.
During the March quarter, the company took delivery of 14 jets from its order book. This represented $900 million in aircraft investments. Riding on the new deliveries, AL exited the quarter with 472 aircraft in its owned fleet and $31 billion in total assets.
Air Lease exited the quarter with $554.4 million in cash and cash equivalents, compared with $460.9 million at 2023-end. Debt financing, net of discount and issuance costs, amounted to $19.48 billion at the end of the first quarter, compared with $19.2 billion at 2023-end.
In May, Air Lease’s board of directors declared a quarterly cash dividend of 21 cents per share. The next quarterly dividend of 21 cents per share will be paid on Jul 8, 2024, to shareholders of record as of Jun 4, 2024.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates review.
VGM Scores
Currently, Air Lease has an average Growth Score of C, however its Momentum Score is doing a bit better with a B. Charting a somewhat similar path, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Air Lease has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
Performance of an Industry Player
Air Lease is part of the Zacks Transportation - Equipment and Leasing industry. Over the past month, Westinghouse Air Brake Technologies (WAB), a stock from the same industry, has gained 0.1%. The company reported its results for the quarter ended March 2024 more than a month ago.
Wabtec reported revenues of $2.5 billion in the last reported quarter, representing a year-over-year change of +13.8%. EPS of $1.89 for the same period compares with $1.28 a year ago.
For the current quarter, Wabtec is expected to post earnings of $1.81 per share, indicating a change of +28.4% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.3% over the last 30 days.
Wabtec has a Zacks Rank #1 (Strong Buy) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of D.
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Air Lease Corporation (AL) : Free Stock Analysis Report
Westinghouse Air Brake Technologies Corporation (WAB) : Free Stock Analysis Report
