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Air Lease (AL) Rides on Fleet Growth, Rising Expenses Ail
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Air Lease Corporation’s (AL - Free Report) top line is benefiting from continuous growth in its fleet. Strong freight and cargo markets are supporting demand for the company’s wide-body passenger aircraft. The continued recovery in airline operations is further driving Air Lease demand.
Meanwhile, shares of Air Lease have gained 29.6% over the past six months, outperforming 23.1% growth of the industry it belongs to.
Image Source: Zacks Investment Research
Notably, AL’s efforts to reward its shareholders are encouraging. Concurrent with the third quarter of 2022 earnings release, Air Lease’s board approved a dividend hike of almost 8.1%, raising the quarterly cash dividend from 18.5 cents per share to 20 cents. The raised dividend will be paid on Jan 10, 2023, to shareholders of record as of Dec 16, 2022. Such shareholder-friendly moves boost investor confidence and positively impact the company’s bottom line.
Total revenues jumped 7% year over year in the third quarter of 2022, owing to the continuous growth in Air Lease’s fleet, lower lease restructuring losses and higher aircraft sales, trading and other revenues. During the third quarter of 2022, AL took delivery of a total of 14 aircrafts, representing approximately $843 million in aircraft investments. As of Sep 30, 2022, Air Lease’s fleet included 405 owned and 87 managed aircraft, with 412 new aircraft orders from Boeing and Airbus.
Revenues from the rental of flight equipment climbed 4.2% year over year to $541.39 million in the reported quarter. As of Sep 30, 2022, Air Lease owned 405 aircraft with a net book value of $23.9 billion. The total fleet size at the end of the third quarter was 904 (including the owned fleet of 405) compared with 911 at the end of June 2022.
On the flip side, rising operating expenses pose a threat to the company's bottom line. Total operating expenses jumped 8.6% year over year in third-quarter 2022. The depreciation of flight equipment costs rose 7.8%. Selling, general and administrative expenses increased 27.8% year over year.
Some better-ranked stocks from the broader Zacks Transportation sector are United Airlines Holdings, Inc. (UAL - Free Report) , Ryder Systems (R - Free Report) and Teekay Tankers Ltd. (TNK - Free Report) , each currently carrying a Zacks Rank #2 (Buy).
UAL has an expected earnings growth rate of 115.64% for the current year. UAL delivered a trailing four-quarter earnings surprise of 7.78%, on average.
The Zacks Consensus Estimate for UAL’s current-year earnings has improved more than 100% over the past 90 days. Shares of UAL have gained 6.6% over the past year.
Ryder has an expected earnings growth rate of 67.12% for the current year. R delivered a trailing four-quarter earnings surprise of 30.13%, on average.
The Zacks Consensus Estimate for R’s current-year earnings has improved 6.9% over the past 90 days. Shares of R have gained 4.7% over the past year.
Teekay Tankers has an expected earnings growth rate of 214.91% for the current year. TNK delivered a trailing four-quarter earnings surprise of 42.23%, on average. Teekay Tankers has a long-term expected growth rate of 3%.
The Zacks Consensus Estimate for TNK’s current-year earnings has improved 95% over the past 90 days. Shares of TNK have soared 176.8% over the past year.
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Air Lease (AL) Rides on Fleet Growth, Rising Expenses Ail
Air Lease Corporation’s (AL - Free Report) top line is benefiting from continuous growth in its fleet. Strong freight and cargo markets are supporting demand for the company’s wide-body passenger aircraft. The continued recovery in airline operations is further driving Air Lease demand.
Meanwhile, shares of Air Lease have gained 29.6% over the past six months, outperforming 23.1% growth of the industry it belongs to.
Image Source: Zacks Investment Research
Notably, AL’s efforts to reward its shareholders are encouraging. Concurrent with the third quarter of 2022 earnings release, Air Lease’s board approved a dividend hike of almost 8.1%, raising the quarterly cash dividend from 18.5 cents per share to 20 cents. The raised dividend will be paid on Jan 10, 2023, to shareholders of record as of Dec 16, 2022. Such shareholder-friendly moves boost investor confidence and positively impact the company’s bottom line.
Total revenues jumped 7% year over year in the third quarter of 2022, owing to the continuous growth in Air Lease’s fleet, lower lease restructuring losses and higher aircraft sales, trading and other revenues. During the third quarter of 2022, AL took delivery of a total of 14 aircrafts, representing approximately $843 million in aircraft investments. As of Sep 30, 2022, Air Lease’s fleet included 405 owned and 87 managed aircraft, with 412 new aircraft orders from Boeing and Airbus.
Revenues from the rental of flight equipment climbed 4.2% year over year to $541.39 million in the reported quarter. As of Sep 30, 2022, Air Lease owned 405 aircraft with a net book value of $23.9 billion. The total fleet size at the end of the third quarter was 904 (including the owned fleet of 405) compared with 911 at the end of June 2022.
On the flip side, rising operating expenses pose a threat to the company's bottom line. Total operating expenses jumped 8.6% year over year in third-quarter 2022. The depreciation of flight equipment costs rose 7.8%. Selling, general and administrative expenses increased 27.8% year over year.
Zacks Rank and Stocks to Consider
Currently, Air Lease carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some better-ranked stocks from the broader Zacks Transportation sector are United Airlines Holdings, Inc. (UAL - Free Report) , Ryder Systems (R - Free Report) and Teekay Tankers Ltd. (TNK - Free Report) , each currently carrying a Zacks Rank #2 (Buy).
UAL has an expected earnings growth rate of 115.64% for the current year. UAL delivered a trailing four-quarter earnings surprise of 7.78%, on average.
The Zacks Consensus Estimate for UAL’s current-year earnings has improved more than 100% over the past 90 days. Shares of UAL have gained 6.6% over the past year.
Ryder has an expected earnings growth rate of 67.12% for the current year. R delivered a trailing four-quarter earnings surprise of 30.13%, on average.
The Zacks Consensus Estimate for R’s current-year earnings has improved 6.9% over the past 90 days. Shares of R have gained 4.7% over the past year.
Teekay Tankers has an expected earnings growth rate of 214.91% for the current year. TNK delivered a trailing four-quarter earnings surprise of 42.23%, on average. Teekay Tankers has a long-term expected growth rate of 3%.
The Zacks Consensus Estimate for TNK’s current-year earnings has improved 95% over the past 90 days. Shares of TNK have soared 176.8% over the past year.