AAR CORP (AIR) Stock Fundamental Analysis
USA - NYSE:AIR - US0003611052 - Common Stock
84.73 USD
+0.71 (+0.85%)
84.85 USD
+0.12 (+0.14%)
We assign a fundamental rating of 5 out of 10 to AIR. AIR was compared to 70 industry peers in the Aerospace & Defense industry. AIR has an average financial health and profitability rating. AIR is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year AIR was profitable.
In the past year AIR had a positive cash flow from operations.
Each year in the past 5 years AIR has been profitable.
In the past 5 years AIR always reported a positive cash flow from operatings.
1.2 Ratios
AIR has a Return On Assets (0.99%) which is comparable to the rest of the industry.
With a Return On Equity value of 2.31%, AIR perfoms like the industry average, outperforming 48.57% of the companies in the same industry.
The Return On Invested Capital of AIR (8.79%) is better than 77.14% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for AIR is in line with the industry average of 8.41%.
The last Return On Invested Capital (8.79%) for AIR is above the 3 year average (7.36%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.99% | ||
| ROE | 2.31% | ||
| ROIC | 8.79% |
ROA(3y)2.32%
ROA(5y)2.84%
ROE(3y)4.33%
ROE(5y)4.83%
ROIC(3y)7.36%
ROIC(5y)6.95%
1.3 Margins
Looking at the Profit Margin, with a value of 1.01%, AIR is in line with its industry, outperforming 42.86% of the companies in the same industry.
In the last couple of years the Profit Margin of AIR has grown nicely.
The Operating Margin of AIR (9.31%) is comparable to the rest of the industry.
AIR's Operating Margin has improved in the last couple of years.
AIR has a worse Gross Margin (19.04%) than 67.14% of its industry peers.
In the last couple of years the Gross Margin of AIR has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 9.31% | ||
| PM (TTM) | 1.01% | ||
| GM | 19.04% |
OM growth 3Y14.65%
OM growth 5Y34.25%
PM growth 3Y-52.86%
PM growth 5Y16.72%
GM growth 3Y3.32%
GM growth 5Y7.87%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), AIR is destroying value.
The number of shares outstanding for AIR has been increased compared to 1 year ago.
The number of shares outstanding for AIR has been increased compared to 5 years ago.
Compared to 1 year ago, AIR has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 3.36 indicates that AIR is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 3.36, AIR is in line with its industry, outperforming 47.14% of the companies in the same industry.
A Debt/Equity ratio of 0.82 indicates that AIR is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.82, AIR is doing worse than 70.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.82 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 3.36 |
ROIC/WACC0.91
WACC9.62%
2.3 Liquidity
AIR has a Current Ratio of 2.91. This indicates that AIR is financially healthy and has no problem in meeting its short term obligations.
AIR has a better Current ratio (2.91) than 61.43% of its industry peers.
AIR has a Quick Ratio of 1.31. This is a normal value and indicates that AIR is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.31, AIR is in line with its industry, outperforming 42.86% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.91 | ||
| Quick Ratio | 1.31 |
3. Growth
3.1 Past
AIR shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 21.83%, which is quite impressive.
AIR shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 12.75% yearly.
AIR shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 17.59%.
AIR shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 6.06% yearly.
EPS 1Y (TTM)21.83%
EPS 3Y17.57%
EPS 5Y12.75%
EPS Q2Q%27.06%
Revenue 1Y (TTM)17.59%
Revenue growth 3Y15.17%
Revenue growth 5Y6.06%
Sales Q2Q%11.77%
3.2 Future
Based on estimates for the next years, AIR will show a quite strong growth in Earnings Per Share. The EPS will grow by 14.85% on average per year.
Based on estimates for the next years, AIR will show a small growth in Revenue. The Revenue will grow by 1.07% on average per year.
EPS Next Y14.47%
EPS Next 2Y13.76%
EPS Next 3Y14.85%
EPS Next 5YN/A
Revenue Next Year9.9%
Revenue Next 2Y8.3%
Revenue Next 3Y6.82%
Revenue Next 5Y1.07%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 20.52 indicates a rather expensive valuation of AIR.
92.86% of the companies in the same industry are more expensive than AIR, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 27.77. AIR is valued slightly cheaper when compared to this.
With a Price/Forward Earnings ratio of 16.79, AIR is valued correctly.
Based on the Price/Forward Earnings ratio, AIR is valued cheaper than 90.00% of the companies in the same industry.
AIR is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 23.23, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.52 | ||
| Fwd PE | 16.79 |
4.2 Price Multiples
AIR's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. AIR is cheaper than 95.71% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 13.29 |
4.3 Compensation for Growth
AIR's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of AIR may justify a higher PE ratio.
A more expensive valuation may be justified as AIR's earnings are expected to grow with 14.85% in the coming years.
PEG (NY)1.42
PEG (5Y)1.61
EPS Next 2Y13.76%
EPS Next 3Y14.85%
5. Dividend
5.1 Amount
AIR does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
84.73
+0.71 (+0.85%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryAerospace & Defense
Earnings (Last)
Earnings (Next)
Inst Owners98.03%
Inst Owner Change-0.02%
Ins Owners2.4%
Ins Owner Change0.98%
Market Cap3.35B
Analysts82
Price Target88.82 (4.83%)
Short Float %2.74%
Short Ratio2.2
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)11.36%
Min EPS beat(2)8.56%
Max EPS beat(2)14.17%
EPS beat(4)4
Avg EPS beat(4)7.56%
Min EPS beat(4)1.68%
Max EPS beat(4)14.17%
EPS beat(8)8
Avg EPS beat(8)4.59%
EPS beat(12)12
Avg EPS beat(12)4.86%
EPS beat(16)15
Avg EPS beat(16)4.6%
Revenue beat(2)2
Avg Revenue beat(2)6.85%
Min Revenue beat(2)6.33%
Max Revenue beat(2)7.38%
Revenue beat(4)3
Avg Revenue beat(4)3.4%
Min Revenue beat(4)-3.93%
Max Revenue beat(4)7.38%
Revenue beat(8)4
Avg Revenue beat(8)1.16%
Revenue beat(12)8
Avg Revenue beat(12)2.16%
Revenue beat(16)10
Avg Revenue beat(16)1.63%
PT rev (1m)4.81%
PT rev (3m)9.19%
EPS NQ rev (1m)-0.51%
EPS NQ rev (3m)-1.95%
EPS NY rev (1m)-0.9%
EPS NY rev (3m)-1.43%
Revenue NQ rev (1m)3.74%
Revenue NQ rev (3m)4.61%
Revenue NY rev (1m)3.43%
Revenue NY rev (3m)4.57%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.52 | ||
| Fwd PE | 16.79 | ||
| P/S | 1.17 | ||
| P/FCF | N/A | ||
| P/OCF | 342.03 | ||
| P/B | 2.68 | ||
| P/tB | 6.98 | ||
| EV/EBITDA | 13.29 |
EPS(TTM)4.13
EY4.87%
EPS(NY)5.05
Fwd EY5.96%
FCF(TTM)-0.65
FCFYN/A
OCF(TTM)0.25
OCFY0.29%
SpS72.25
BVpS31.58
TBVpS12.14
PEG (NY)1.42
PEG (5Y)1.61
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.99% | ||
| ROE | 2.31% | ||
| ROCE | 11.13% | ||
| ROIC | 8.79% | ||
| ROICexc | 9.1% | ||
| ROICexgc | 13.64% | ||
| OM | 9.31% | ||
| PM (TTM) | 1.01% | ||
| GM | 19.04% | ||
| FCFM | N/A |
ROA(3y)2.32%
ROA(5y)2.84%
ROE(3y)4.33%
ROE(5y)4.83%
ROIC(3y)7.36%
ROIC(5y)6.95%
ROICexc(3y)7.68%
ROICexc(5y)7.26%
ROICexgc(3y)10.94%
ROICexgc(5y)9.53%
ROCE(3y)9.32%
ROCE(5y)8.8%
ROICexcg growth 3Y18.86%
ROICexcg growth 5Y36.52%
ROICexc growth 3Y7.16%
ROICexc growth 5Y28.07%
OM growth 3Y14.65%
OM growth 5Y34.25%
PM growth 3Y-52.86%
PM growth 5Y16.72%
GM growth 3Y3.32%
GM growth 5Y7.87%
F-Score6
Asset Turnover0.98
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.82 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 3.18 | ||
| Cap/Depr | 64.78% | ||
| Cap/Sales | 1.24% | ||
| Interest Coverage | 3.6 | ||
| Cash Conversion | 3.05% | ||
| Profit Quality | N/A | ||
| Current Ratio | 2.91 | ||
| Quick Ratio | 1.31 | ||
| Altman-Z | 3.36 |
F-Score6
WACC9.62%
ROIC/WACC0.91
Cap/Depr(3y)80.23%
Cap/Depr(5y)64.82%
Cap/Sales(3y)1.34%
Cap/Sales(5y)1.13%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)21.83%
EPS 3Y17.57%
EPS 5Y12.75%
EPS Q2Q%27.06%
EPS Next Y14.47%
EPS Next 2Y13.76%
EPS Next 3Y14.85%
EPS Next 5YN/A
Revenue 1Y (TTM)17.59%
Revenue growth 3Y15.17%
Revenue growth 5Y6.06%
Sales Q2Q%11.77%
Revenue Next Year9.9%
Revenue Next 2Y8.3%
Revenue Next 3Y6.82%
Revenue Next 5Y1.07%
EBIT growth 1Y75.48%
EBIT growth 3Y32.05%
EBIT growth 5Y42.38%
EBIT Next Year36.67%
EBIT Next 3Y17.93%
EBIT Next 5YN/A
FCF growth 1Y24.63%
FCF growth 3Y-71.08%
FCF growth 5YN/A
OCF growth 1Y545.46%
OCF growth 3Y-21.7%
OCF growth 5YN/A