Air Lease (AL) AI Stock Analysis

• Market Cap: $4.70B
• Dividend Yield: 2.04%
• Average Volume (3M): 836.52K
• Price to Earnings (P/E): 12.6
• Beta (1Y): 1.15
• Revenue Growth: 2.65%
• EPS Growth: -35.24%
• Country: US
• Employees: 165
• Sector: Industrials
• Sector Strength: 63
• Industry: Rental & Leasing Services
• EPS (TTM): 3.33
• Shares Outstanding: 111,759,130
• 10 Day Avg. Volume: 1,004,656
• 30 Day Avg. Volume: 836,517
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 1.92
• Price to Cash Flow (P/CF): 3.10
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $54.25
• Price Target Upside: 29.78% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 4

Air Lease Corporation demonstrates strong financial performance due to its consistent revenue growth, high operational efficiency, and solid balance sheet with no debt. The positive earnings outlook and strategic fleet expansion further enhance its standing. However, challenges with cash flow management and potential interest rate impacts slightly temper the score. Technical indicators suggest a neutral market sentiment, while the valuation remains attractive. Overall, Air Lease presents a compelling investment with a blend of stability and growth potential.

Positive Factors

Aircraft Deliveries

Deliveries were strong this quarter, a quarterly high for AL: AL delivered 20 aircraft in Q3, up from Q2-24's 13 and significantly higher than Q3-23's 8 deliveries.

Financial Performance

The beat was primarily driven by higher aircraft sales and lower interest expense.

Lease Revenue

Management indicated that most renewals would be at higher rates, and those that were restructured during COVID would be significantly higher, driving faster lease revenue.

Negative Factors

Cost of Funds

There is a potential pressure on near-term funding costs due to a rise in the average cost of funds.

Management Guidance

Management’s 2025 guidance of $3.0–3.5 billion came in lower than expected.

Supply Chain Issues

Restarting the production process, combining with supply chain issues, is expected to negatively affect the deliveries and contribute to the ongoing delays.

Air Lease Business Overview & Revenue Model

Company Description

Air Lease Corporation, an aircraft leasing company, engages in the purchase and leasing of commercial jet aircraft to airlines worldwide. It also sells aircraft from its operating lease portfolio to third parties, including other leasing companies, financial services companies, airlines, and other investors. In addition, the company provides fleet management services to investors and owners of aircraft portfolios. As of December 31, 2021, it owned a fleet of 382 aircraft, including 278 narrowbody aircraft and 104 widebody aircraft. The company was incorporated in 2010 and is headquartered in Los Angeles, California.

How the Company Makes Money

Air Lease Corporation generates revenue primarily through leasing aircraft to airlines. The company enters into long-term lease agreements with airlines, which provide a consistent and predictable stream of income. These leases typically include fixed monthly payments, which cover the cost of the aircraft and generate profit for the company. Additionally, Air Lease may earn revenue through the sale of aircraft from its fleet and through fleet management services. The company's financial performance is bolstered by its relationships with major aircraft manufacturers, allowing it to acquire new aircraft at competitive prices, which it can lease at favorable rates.

Air Lease Financial Statement Overview

Summary

Air Lease exhibits strong revenue growth and operational efficiency, as evidenced by its high gross profit and EBIT margins. The lack of debt enhances its financial stability. However, the decline in net profit margin and negative free cash flow reflect challenges in profitability and cash management. Overall, the company maintains a robust financial position with room for improvement in profitability and cash flow management.

Income Statement

Air Lease has demonstrated consistent revenue growth with a notable increase from $2.69 billion in 2023 to $2.73 billion in 2024. The gross profit margin appears strong at 100% due to the nature of its business model. However, the net profit margin decreased from 22.9% in 2023 to 13.6% in 2024, indicating reduced profitability. Despite this, EBIT margin improved significantly, showcasing operational efficiency. The data suggests strong operational performance but highlights a decrease in net income impact on profit margins.

Balance Sheet

The balance sheet reflects a robust equity position with stockholders' equity growing to $7.53 billion in 2024. The debt-to-equity ratio is 0, indicating no debt, which is a positive sign of financial strength. The equity ratio has improved, suggesting a stronger asset base relative to liabilities. Return on equity has decreased due to lower net income, but overall, the company's financial leverage is well-managed.

Cash Flow

There is a negative free cash flow trend, with a free cash flow of -$2.5 billion in 2024, but it's an improvement from the previous year. The operating cash flow to net income ratio is strong at 4.51, highlighting efficient cash generation from operations. The free cash flow to net income ratio is negative, reflecting ongoing capital expenditures exceeding cash generated.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
2.73B	2.68B	2.32B	2.09B	2.02B
	Gross Profit
2.73B	961.29M	858.42M	743.43M	803.01M
	EBIT
2.55B	1.43B	685.97M	591.64M	689.70M
	EBITDA
1.73B	1.88B	1.37B	1.47B	1.47B
	Net Income Common Stockholders
372.07M	614.62M	-97.02M	436.63M	516.26M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
472.55M	460.87M	766.42M	1.09B	1.73B
	Total Assets
32.28B	30.45B	28.40B	26.97B	25.22B
	Total Debt
20.21B	19.18B	18.64B	17.02B	16.52B
	Net Debt
19.74B	18.72B	17.87B	15.94B	14.78B
	Total Liabilities
24.75B	23.29B	21.75B	19.96B	19.14B
	Stockholders Equity
7.53B	7.16B	6.65B	7.01B	6.07B
Cash Flow		Free Cash Flow
-2.50B	-2.78B	-2.26B	-1.86B	-1.59B
	Operating Cash Flow
1.68B	1.75B	1.38B	1.38B	1.09B
	Investing Cash Flow
-3.04B	-2.78B	-3.40B	-3.09B	-2.53B
	Financing Cash Flow
1.37B	715.98M	1.69B	1.07B	2.86B

Air Lease Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 41.80
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AL, the sentiment is Negative. The current price of 41.8 is below the 20-day moving average (MA) of 46.66, below the 50-day MA of 46.61, and below the 200-day MA of 46.17, indicating a bearish trend. The MACD of 0.59 indicates Negative momentum. The RSI at 56.70 is Neutral, neither overbought nor oversold. The STOCH value of 57.63 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AL.

Air Lease Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AL	76 Outperform	$4.70B	12.64	5.82%	2.04%	2.65%	-35.24%
TRN	70 Neutral	$2.05B	15.26	14.57%	4.54%	3.21%	29.59%
ALK	68 Neutral	$5.46B	14.37	9.31%	―	12.56%	69.33%
GATX	68 Neutral	$5.08B	18.30	11.86%	1.65%	12.38%	7.93%
SKYW	63 Neutral	$3.26B	10.25	14.28%	―	20.18%	794.72%
Sector *	62 Neutral	$7.24B	12.39	3.08%	3.39%	3.63%	-14.35%
JBLU	47 Neutral	$1.40B	―	-26.60%	―	-3.50%	-148.99%

Air Lease Corporate Events

Air Lease Announces Retirement of Executive Chairman

On March 13, 2025, Air Lease Corporation announced that its Executive Chairman, Steven Udvar-Házy, will retire on May 2, 2025, following the company’s annual meeting. Mr. Udvar-Házy, who founded the company in 2010, will transition to a non-executive Chairman role until 2026. His retirement marks the end of a significant era, as he played a pivotal role in the growth and success of the company, which boasts over $32 billion in assets and has returned substantial capital to stockholders. The transition is expected to be smooth, with the leadership team poised to continue building on the company’s strong foundation.

Air Lease Reports Record Revenue and Fleet Value

On February 13, 2025, Air Lease Corporation held a conference call to discuss its financial results for Q4 2024 and the full year. The company reported record revenue and fleet net book value for 2024, driven by fleet expansion and aircraft sales. Despite challenges in aircraft delivery and manufacturing, Air Lease expects to maintain strong performance in 2025, with robust lease rates and reduced debt funding needs due to self-funding capabilities. The company also highlighted the growing demand for widebody aircraft and the successful reduction of its exposure to the Chinese market.