AerCap Holdings N.V. (NYSE: AER) has disappointed investors with its weaker-than-expected earnings for the first quarter of 2022. The company reported a loss per share of $8.35, which lagged the consensus estimate of $1.41 in earnings per share.
However, when adjusting for charges related to the Russia-Ukraine war and other items, the company earned $2.23 per share, beating estimates. AER stock is currently up over 6%.
Owing to the Ukraine-Russia conflict, the company took a pre-tax charge of $2.7 billion in Q1, relating to flight equipment write-offs and impairments, which were somewhat offset by the derecognition of lease-related assets and liabilities.
Revenues increased 63% year-over-year to $1.79 billion, driven by a solid rise in lease revenue. Basic lease rents rose 75%, primarily due to the impact of the GECAS acquisition. Its total expenses increased year-over-year from $827 million to $4.07 billion.
In the quarter, 157 lease agreements were executed by the company, which included 102 lease agreements, 25 purchases, and 30 sales.
AerCap is an aviation leasing company. Along with leasing services of helicopters, aircraft, and engines, it provides aircraft management, sales, and financing services to a huge client base in the U.S., Hong Kong, Ireland, and other countries.
Wall Street’s Take
The consensus among analysts is a Strong Buy based on eight unanimous Buy ratings assigned in the past three months. The average AerCap price target stands at $74.25 and implies upside potential of 54.3% from current levels.
TipRanks data shows that financial blogger opinions are 100% Bullish on AER, compared to a sector average of 69%.
With a recovery in travel demand, the performance of AerCap is expected to improve in the quarters ahead. Further, bullish analyst and blogger sentiment keeps us optimistic.
Discover new investment ideas with data you can trust.