William Blair analyst Louie DiPalma has maintained their bullish stance on AIR stock, giving a Buy rating on December 8.
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Louie DiPalma has given his Buy rating due to a combination of factors that highlight AAR’s promising business trends and growth potential. The company’s Trax, distribution, heavy maintenance, and component repair product lines are experiencing healthy trends, supported by a robust aerospace aftermarket environment. AAR’s valuation is considered to have room for expansion, with the potential to align more closely with higher multiples seen in comparable companies like StandardAero.
DiPalma is particularly optimistic about the long-term prospects of Trax, AAR’s enterprise resource planning system, which is gaining traction among major airlines such as Delta, Cathay Pacific, Singapore Airlines, and Virgin Atlantic. Despite being a smaller revenue contributor currently, Trax is expected to drive significant growth through new customer acquisitions and upgrades from existing clients. The transition of many customers to the SaaS version of Trax is anticipated to enhance margins and drive further revenue growth, positioning AAR for substantial upside in the market.
In another report released on December 8, RBC Capital also maintained a Buy rating on the stock with a $90.00 price target.