Aar Stock Price Lagging Behind Peers Due to Government Business, Analyst Says

By Don Francis, Editor
May 15, 2024 7:03 AM UTC
Aar Stock Price Lagging Behind Peers Due to Government Business, Analyst Says

Stifel Nicolaus's Bert Subin raised their price target on Aar (NYSE: AIR) by 6.2% from $81 to $86 on 2024/05/14. The analyst maintained their Strong Buy rating on the stock.

In a recent analysis, Subin highlighted the reasons behind Aar's stock price not keeping pace with other names in the Aerospace Aftermarket group over the past few months. According to Subin, "lagging government business that's weighed on total organic growth continues to be a headwind." However, the analyst expressed optimism for the future, stating that "the extending commercial aero aftermarket cycle, paired with sequential improvement in government business, could yield a strong growth setup for F 2025 that will likely spillover into FY 2026."

Subin's positive outlook aligns with the sentiments of other top-rated analysts. Currently, 100% of these analysts rate AIR as a Strong Buy or Buy, with none suggesting a Hold or recommending selling the stock.

The consensus forecast among analysts is that AIR's upcoming year will deliver earnings per share (EPS) of $2.8. This would represent a significant 64.6% increase on a year-over-year basis, indicating strong growth potential for the company.

When looking at the stock's performance, it is evident that AIR has been on an upward trajectory. Year-over-year, the stock has seen a 35.8% increase, outpacing the S&P 500, which has grown by 26.8% during the same period.

Bert Subin, the Stifel Nicolaus analyst behind the recent price target increase, is ranked in the top 18% of Wall Street analysts by WallStreetZen. With an average return of 7.4% and a 62.5% win rate, Subin specializes in the Technology and Industrials sectors, making their analysis of AIR particularly noteworthy.

AAR CORP., the company in question, is involved in the sale and lease of new, overhauled, and repaired engine and airframe parts. They cater to the commercial aviation, government, and defense markets worldwide. Additionally, AAR designs, manufactures, and repairs transportation pallets, containers, and shelters, along with composite materials for commercial, business, and military aircraft. Founded in 1951 and headquartered in Wood Dale, IL, AAR has established itself as a prominent player in the aerospace industry.

Is Aar a Buy, Hold or Sell?

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