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AAR Corp. (AIR) Set to Post Q1 Earnings: What's in Store?

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AAR Corp. (AIR - Free Report) is scheduled to release first-quarter fiscal 2022 results on Sep 23, after market close. In the last reported quarter, the company delivered an earnings surprise of 6.8%.

AAR Corp. has a four-quarter earnings surprise of 78.7%, on average.

Let’s discuss the factors that are likely to get reflected in the upcoming quarterly results.

Factors at Play

As commercial air travel has been showing a consistent recovery in the recent past, the maintenance, repair and overhaul market has been reflecting signs of moderate improvement. This in turn can be expected to have boosted AAR Corp.’s overall performance in the fiscal first quarter.

AAR Corp. Price and EPS Surprise

AAR Corp. Price and EPS Surprise

AAR Corp. price-eps-surprise | AAR Corp. Quote

The company’s government and defense businesses, which have been delivering strong performance amid the challenges posed by the COVID-19 pandemic, must have also performed favorably.

This in turn is expected to have boosted its overall top-line performance in the soon-to-be-reported quarter.

The Zacks Consensus Estimate for fiscal first-quarter revenues is pegged at $437.7 million, which indicates a rise of 9.2% from the year-ago reported figure.

Stable earnings from the Department of State’s WASS contract, which has been a consistent growth driver for AAR Corp.’s bottom line over the last few quarters, must have once again contributed favorably to fiscal first-quarter earnings.

Meanwhile, a recovering commercial aerospace market can be projected to have boosted its overall commercial gross margins, thereby aiding bottom-line growth.

The Zacks Consensus Estimate for fiscal first-quarter earnings per share is pegged at 49 cents, which indicates an improvement of 188.2% from the year-ago reported figure.

Earnings Whispers

Our proven model does not conclusively predict an earnings beat for AAR Corp. this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But this is not the case here.

Earnings ESP: The company’s Earnings ESP is 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: AAR Corp. carries a Zacks Rank #2, currently. You can see the complete list of today’s Zacks #1 Rank stocks here.

Stocks to Consider

Here are some defense companies you may want to consider, as these have the right combination of elements to post an earnings beat in their upcoming releases:

Embraer S.A. (ERJ - Free Report) has an Earnings ESP of +41.46% and a Zacks Rank #2.

Heico Corp (HEI - Free Report) has an Earnings ESP of +0.73% and a Zacks Rank #3.

Spirit AeroSystems (SPR - Free Report) has an Earnings ESP of +4.98% and a Zacks Rank #3.

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