In a report released today, Kenneth Herbert from Canaccord Genuity maintained a Buy rating on AAR Corp (NYSE: AIR), with a price target of $52. The company’s shares opened today at $44.78.
Herbert noted:
“We are adjusting our Q1/19 revenue estimate by ~$40M due to timing issues in the MRO market. Specifically, the delays in new A320 and 737 aircraft deliveries, due largely to delays in new engine deliveries, have resulted in stronger-than-expected demand for the current aircraft fleet. Typically, when airline MRO activity hits its usual seasonal low in the summer, AAR can offset this decline at least partially with one-off visits from lessor-owned aircraft. As a result of the ~125 new aircraft delivery delays, lessors are not taking aircraft in for MRO at the usual rate. This is creating a revenue headwind for AAR in fiscal Q1/19. Management highlighted its Q1/19 outlook at our recent Global Growth Conference.”
According to TipRanks.com, Herbert is a 5-star analyst with an average return of 12.6% and a 65.2% success rate. Herbert covers the Consumer Goods sector, focusing on stocks such as Transdigm Group Inc, CPI Aerostructures, and Spirit AeroSystems.
AAR Corp has an analyst consensus of Strong Buy, with a price target consensus of $51.33.
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Based on AAR Corp’s latest earnings release for the quarter ending May 31, the company reported a quarterly net profit of $11.9 million. In comparison, last year the company had a net profit of $21 million.
Based on the recent corporate insider activity of 38 insiders, corporate insider sentiment is neutral on the stock.
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AAR Corp. engages in the provision of products and services to commercial aviation and government and defense industries. It operates through the Aviation Services and Expeditionary Services segments.
