(AIR) AAR - Overview
Sector: Industrials | Industry: Aerospace & Defense | Exchange: NYSE (USA) | Market Cap: 4.312m USD | Total Return: 10.8% in 12m
Avg Turnover: 43.0M
EPS Trend: 98.0%
Qual. Beats: 2
Rev. Trend: 99.8%
Qual. Beats: 4
Warnings
Choppy Below Avwap Earnings
Tailwinds
No distinct edge detected
AAR Corp. (AIR) is an independent provider of aviation services and products to commercial and defense markets globally. The company operates across four primary segments: Parts Supply, Repair & Engineering, Integrated Solutions, and Expeditionary Services. Its core business includes the sale and lease of aircraft components, airframe maintenance, repair and overhaul (MRO) services, and the development of proprietary engineering solutions and fleet management software.
The company functions within the aftermarket aerospace sector, where demand is largely driven by global flight hours and the aging of existing commercial and military fleets. Unlike original equipment manufacturers (OEMs), independent MRO providers like AAR Corp. often benefit from airline cost-reduction initiatives that prioritize third-party maintenance and used serviceable material (USM).
Investors can further examine these market dynamics and valuation metrics on ValueRay.
Headquartered in Wood Dale, Illinois, the firm also provides specialized logistics and expeditionary services, including the manufacturing of military-grade containers and shelters for tactical deployments. AAR Corp. maintains a diversified revenue stream by supporting both civilian aviation infrastructure and government-contracted defense programs.
- Commercial aircraft maintenance demand increases as global passenger fleet ages
- Defense contract awards drive long-term revenue stability in Integrated Solutions
- Parts Supply segment margins fluctuate based on surplus engine material availability
- Strategic acquisitions like Triumph Product Support expand global service footprint
- Labor shortages and rising technician wages impact Repair and Engineering profitability
| Net Income: 171.0m TTM > 0 and > 6% of Revenue |
| FCF/TA: 0.03 > 0.02 and ΔFCF/TA 2.78 > 1.0 |
| NWC/Revenue: 35.43% < 20% (prev 36.89%; Δ -1.46% < -1%) |
| CFO/TA 0.03 > 3% & CFO 94.8m > Net Income 171.0m |
| Net Debt (992.6m) to EBITDA (329.6m): 3.01 < 3 |
| Current Ratio: 2.70 > 1.5 & < 3 |
| Outstanding Shares: last quarter (38.0m) vs 12m ago 7.34% < -2% |
| Gross Margin: 19.00% > 18% (prev 0.19%; Δ 1.88k% > 0.5%) |
| Asset Turnover: 101.3% > 50% (prev 93.82%; Δ 7.43% > 0%) |
| Interest Coverage Ratio: 3.57 > 6 (EBITDA TTM 329.6m / Interest Expense TTM 73.8m) |
| A: 0.33 (Total Current Assets 1.76b - Total Current Liabilities 653.0m) / Total Assets 3.33b |
| B: 0.33 (Retained Earnings 1.11b / Total Assets 3.33b) |
| C: 0.09 (EBIT TTM 263.4m / Avg Total Assets 3.10b) |
| D: 0.68 (Book Value of Equity 1.15b / Total Liabilities 1.69b) |
| Altman-Z'' = 4.56 = AA |
| DSRI: 1.04 (Receivables 568.5m/465.8m, Revenue 3.13b/2.68b) |
| GMI: 0.99 (GM 19.00% / 18.82%) |
| AQI: 0.81 (AQ_t 0.31 / AQ_t-1 0.38) |
| SGI: 1.17 (Revenue 3.13b / 2.68b) |
| TATA: 0.02 (NI 171.0m - CFO 94.8m) / TA 3.33b) |
| Beneish M = -2.97 (Cap -4..+1) = A |
As of May 26, 2026, the stock is trading at USD 108.41 with a total of 176,200 shares traded.
Over the past week, the price has changed by +2.28%,
over one month by +5.25%,
over three months by -3.79% and
over the past year by +10.77%.
AAR has received a consensus analysts rating of 4.83. Therefore, it is recommended to buy AIR.
- StrongBuy: 5
- Buy: 1
- Hold: 0
- Sell: 0
- StrongSell: 0
| Analysts Target Price | 131.7 | 21.5% |
P/E Trailing = 23.833
P/E Forward = 20.0
P/S = 1.3757
P/B = 2.6239
P/EG = 2.4021
Revenue TTM = 3.13b USD
EBIT TTM = 263.4m USD
EBITDA TTM = 329.6m USD
Long Term Debt = 888.3m USD (from longTermDebt, last quarter)
Short Term Debt = 12.3m USD (from shortTermDebt, last fiscal year)
Debt = 1.07b USD (from shortLongTermDebtTotal, last quarter) + Leases 91.4m
Net Debt = 992.6m USD (calculated: Debt 1.07b - CCE 78.5m)
Enterprise Value = 5.30b USD (4.31b + Debt 1.07b - CCE 78.5m)
Interest Coverage Ratio = 3.57 (Ebit TTM 263.4m / Interest Expense TTM 73.8m)
EV/FCF = 62.55x (Enterprise Value 5.30b / FCF TTM 84.8m)
FCF Yield = 1.60% (FCF TTM 84.8m / Enterprise Value 5.30b)
FCF Margin = 2.71% (FCF TTM 84.8m / Revenue TTM 3.13b)
Net Margin = 5.46% (Net Income TTM 171.0m / Revenue TTM 3.13b)
Gross Margin = 19.00% ((Revenue TTM 3.13b - Cost of Revenue TTM 2.54b) / Revenue TTM)
Gross Margin QoQ = 18.31% (prev 19.73%)
Tobins Q-Ratio = 1.59 (Enterprise Value 5.30b / Total Assets 3.33b)
Interest Expense / Debt = 6.89% (Interest Expense 73.8m / Debt 1.07b)
Taxrate = 26.96% (25.1m / 93.1m)
NOPAT = 192.4m (EBIT 263.4m * (1 - 26.96%))
Current Ratio = 2.70 (Total Current Assets 1.76b / Total Current Liabilities 653.0m)
Debt / Equity = 0.65 (Debt 1.07b / totalStockholderEquity, last quarter 1.64b)
Debt / EBITDA = 3.01 (Net Debt 992.6m / EBITDA 329.6m)
Debt / FCF = 11.71 (Net Debt 992.6m / FCF TTM 84.8m)
Total Stockholder Equity = 1.42b (last 4 quarters mean from totalStockholderEquity)
RoA = 5.52% (Net Income 171.0m / Total Assets 3.33b)
RoE = 12.07% (Net Income TTM 171.0m / Total Stockholder Equity 1.42b)
RoCE = 11.43% (EBIT 263.4m / Capital Employed (Equity 1.42b + L.T.Debt 888.3m))
RoIC = 7.18% (NOPAT 192.4m / Invested Capital 2.68b)
WACC = 9.24% (E(4.31b)/V(5.38b) * Re(10.29%) + D(1.07b)/V(5.38b) * Rd(6.89%) * (1-Tc(0.27)))
Discount Rate = 10.29% (= CAPM, Blume Beta Adj.)
Shares (quarterly) Correlation: 73.61 | Cagr: 3.33%
[DCF] Terminal Value 72.36% ; FCFF base≈84.8m ; Y1≈85.1m ; Y5≈90.2m
[DCF] Fair Price = 5.66 (EV 1.22b - Net Debt 992.6m = Equity 225.1m / Shares 39.8m; r=9.24% [WACC]; 5y FCF grow 0.0% → 2.50% )
EPS Correlation: 97.97 | EPS CAGR: 17.70% | SUE: 1.71 | # QB: 2
Revenue Correlation: 99.80 | Revenue CAGR: 17.77% | SUE: 1.13 | # QB: 4
EPS next Quarter (2026-08-31): EPS=1.28 | Chg30d=-0.52% | Revisions=-20% | Analysts=3
EPS current Year (2026-05-31): EPS=4.90 | Chg30d=+0.12% | Revisions=+0% | GrowthEPS=+25.4% | GrowthRev=+17.7%
EPS next Year (2027-05-31): EPS=5.65 | Chg30d=-0.23% | Revisions=+0% | GrowthEPS=+15.2% | GrowthRev=+10.8%
[Analyst] Revisions Ratio: -20%