Air Lease (AL) AI Stock Analysis

• Market Cap: $6.56B
• Dividend Yield: 1.5%
• Average Volume (3M): 788.73K
• Price to Earnings (P/E): 10.3
• Beta (1Y): 1.04
• Revenue Growth: 2.81%
• EPS Growth: 15.38%
• Country: US
• Employees: 165
• Sector: Industrials
• Sector Strength: 87
• Industry: Rental & Leasing Services
• EPS (TTM): 3.26
• Shares Outstanding: 111,759,130
• 10 Day Avg. Volume: 728,215
• 30 Day Avg. Volume: 788,734
• PEG Ratio: 0.36
• Price to Book (P/B): 0.65
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -1.90
• Enterprise Value/Market Cap: 3.38
• Enterprise Value/Revenue: 2.06
• Enterprise Value/Gross Profit: 13.19
• Enterprise Value/Ebitda: 2.75
• 1Y Price Target: $57.60
• Price Target Upside: -1.89% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5

• Rating: 81 Outperform
• Price Target: $61.00 ▲(3.90%Upside)

Air Lease demonstrates a strong financial position with robust revenue growth, operational efficiency, and a solid balance sheet devoid of debt. The stock's valuation is attractive, and recent positive earnings guidance further supports a favorable outlook. However, the challenges in profitability and cash flow management, along with potential short-term technical corrections due to overbought conditions, slightly temper the overall score.

Positive Factors

Earnings

EPS beats expectations on strong aircraft sales and Russian settlement recovery.

Insurance Settlements

Air Lease’s receipt of US$559M-worth of insurance settlements for their assets in the Russian Federation could provide the opportunity to repurchase shares trading at 0.8x book.

Negative Factors

Funding Costs

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

Market Position

Despite Citi's improved optimism on Air Lease, the long-term risk/reward opportunity in the shares still does not look as good compared to its peers.

OEM Deliveries

Analyst maintains an Underperform rating due to better market positioning of other companies and uncertainty in OEM deliveries.

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 makes money by leasing aircraft to airlines under long-term lease agreements. The company acquires new and used commercial aircraft and leases them to airline customers, generating steady rental income over the lease term. Additionally, it may sell older aircraft from its portfolio, contributing to revenue. Key revenue streams include lease rentals, aircraft sales, and related services. The company's earnings are significantly influenced by factors such as the demand for air travel, interest rates, aircraft values, and the creditworthiness of its airline customers. Successful partnerships with major aircraft manufacturers and a strong global customer base are also crucial to its financial performance.

Air Lease Financial Statement Overview

Summary

Air Lease shows strong revenue growth and operational efficiency, indicated by high gross profit and EBIT margins. The absence of debt enhances financial stability. However, the decline in net profit margin and negative free cash flow highlight challenges in profitability and cash management. Overall, the company's financial position is robust, but there is 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	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.75B	2.73B	2.68B	2.32B	2.09B	2.02B
Gross Profit	1.68B	807.90M	961.29M	858.42M	743.43M	803.01M
EBITDA	1.44B	1.73B	1.88B	1.37B	1.47B	1.47B
Net Income	684.59M	427.70M	614.62M	-97.02M	436.63M	516.26M
Balance Sheet
Total Assets	32.36B	32.28B	30.45B	28.40B	26.97B	25.22B
Cash, Cash Equivalents and Short-Term Investments	456.62M	472.55M	460.87M	766.42M	1.09B	1.73B
Total Debt	0.00	20.21B	19.18B	18.64B	17.02B	16.52B
Total Liabilities	24.50B	24.75B	23.29B	21.75B	19.96B	19.14B
Stockholders Equity	7.87B	7.53B	7.16B	6.65B	7.01B	6.07B
Cash Flow
Free Cash Flow	-462.42M	-2.50B	-2.78B	-2.26B	-1.86B	-1.59B
Operating Cash Flow	1.69B	1.68B	1.75B	1.38B	1.38B	1.09B
Investing Cash Flow	-2.51B	-3.04B	-2.78B	-3.40B	-3.09B	-2.53B
Financing Cash Flow	718.83M	1.37B	715.98M	1.69B	1.07B	2.86B

Air Lease Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 58.71
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AL, the sentiment is Positive. The current price of 58.71 is above the 20-day moving average (MA) of 57.14, above the 50-day MA of 53.66, and above the 200-day MA of 47.97, indicating a bullish trend. The MACD of 0.85 indicates Positive momentum. The RSI at 65.89 is Neutral, neither overbought nor oversold. The STOCH value of 84.50 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AL.

Air Lease Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AL	81 Outperform	$6.56B	10.28	9.22%	1.50%	2.81%	15.38%
SKYW	76 Outperform	$4.18B	11.84	15.66%	―	20.53%	217.24%
TRN	74 Outperform	$2.20B	16.59	14.14%	4.45%	-9.40%	8.41%
GATX	73 Outperform	$5.53B	19.63	11.64%	1.57%	12.07%	11.93%
ALK	72 Outperform	$5.99B	17.94	8.90%	―	20.82%	47.79%
Sector *	65 Neutral	$10.56B	15.49	5.57%	1.96%	2.71%	-26.28%
JBLU	43 Neutral	$1.52B	―	-11.30%	―	-3.02%	66.90%

Air Lease Corporate Events

Air Lease Elects Board and Ratifies Auditor

On May 2, 2025, Air Lease Corporation held its annual stockholders’ meeting, where nine directors were elected to the board, KPMG LLP was ratified as the independent auditor for 2025, and the 2024 executive compensation was approved on an advisory basis. These decisions reflect the company’s ongoing governance and operational strategies, impacting its leadership structure and financial oversight, which are crucial for stakeholders and the company’s strategic direction.

Air Lease Reports Strong Q1 2025 Financial Results

On May 5, 2025, Air Lease held a conference call to discuss its financial results for the first quarter of 2025, reporting revenues of $738 million and $3.26 in diluted earnings per share. The company achieved record levels in total revenue, fleet net book value, and book value per common share, benefiting from fleet expansion and insurance settlements. Despite higher interest expenses and retirement-related costs, Air Lease’s sales pipeline remains robust, with expectations of $1.5 billion in aircraft sales for 2025. The company faces delivery delays from Airbus but continues to see strong demand for aircraft globally, particularly outside North America, where 87% of its business is conducted. Global passenger air traffic growth and favorable economic conditions, like declining fuel prices and a weakening dollar, support the company’s positive outlook.