The firm said it started the integrated global aviation company out with a strong rating based on its Inter Lease Finance Corp. acquisition, and the fact that it relocated to Ireland, a low tax country.
UBS set a $55 price target on the stock.
Separately, TheStreet Ratings team rates AERCAP HOLDINGS NV as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate AERCAP HOLDINGS NV (AER) a HOLD. The primary factors that have impacted our rating are mixed some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income and generally higher debt management risk."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- AER's revenue growth has slightly outpaced the industry average of 2.5%. Since the same quarter one year prior, revenues slightly increased by 9.0%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- Compared to its closing price of one year ago, AER's share price has jumped by 174.44%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
- AERCAP HOLDINGS NV's earnings per share declined by 20.3% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, AERCAP HOLDINGS NV increased its bottom line by earning $2.56 versus $1.21 in the prior year. This year, the market expects an improvement in earnings ($2.90 versus $2.56).
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed against the S&P 500 and did not exceed that of the Trading Companies & Distributors industry. The net income has decreased by 18.9% when compared to the same quarter one year ago, dropping from $67.45 million to $54.71 million.
- The debt-to-equity ratio is very high at 2.50 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company.
- You can view the full analysis from the report here: AER Ratings Report