AAR (NYSE:AIR) Announces Earnings Results, Beats Expectations By $0.16 EPS

AAR (NYSE:AIR) posted its quarterly earnings results on Tuesday. The aerospace company reported $1.18 EPS for the quarter, beating the consensus estimate of $1.02 by $0.16, Zacks reports. The firm had revenue of $795.30 million for the quarter, compared to analyst estimates of $760.95 million. AAR had a net margin of 1.01% and a return on equity of 12.29%. AAR’s revenue for the quarter was up 15.9% compared to the same quarter last year. During the same quarter last year, the firm posted $0.90 earnings per share.

Here are the key takeaways from AAR’s conference call:

• AAR delivered 16% total sales growth (12% organic) to $795M with parts supply up 29%, adjusted EBITDA up 23%, and adjusted diluted EPS up 31% to $1.18, driving improved operating margins to 10.2%.
• The company completed acquisitions of ADI ($138M) and HAECO Americas ($77M) and announced ART ($35M) to expand new parts distribution, airframe heavy maintenance, and interiors; management expects integration to take 12–18 months and to be margin-accretive over time despite near-term dilution.
• New parts distribution grew ~32% organically, driven mainly by volume and strong same-store performance under AAR’s two-way exclusive distributor model, with key renewals (Collins, Arkwin) and no signs of customer destocking.
• Repair & Engineering sales rose 7% to $245M but margins softened due to mix, one-time costs, and the early HAECO contribution; Oklahoma City and Miami heavy-maintenance expansions will add ~$60M in annual revenue in 2026 while integration actions (including exiting Indianapolis) are expected to improve margins over time.

AAR Trading Up 2.1%

Shares of AIR opened at $89.83 on Wednesday. The company has a market capitalization of $3.51 billion, a P/E ratio of 115.16 and a beta of 1.24. AAR has a one year low of $46.51 and a one year high of $90.09. The company has a debt-to-equity ratio of 0.82, a quick ratio of 1.31 and a current ratio of 2.91. The stock has a 50-day moving average price of $82.91 and a 200 day moving average price of $79.15.

AAR News Summary

Here are the key news stories impacting AAR this week:

• Positive Sentiment: Quarterly results and top-line beat: AAR reported roughly $795.3M in revenue (~+16% YoY) and confirmed stronger-than-expected sales; the print and commentary signaled recovery in parts & services demand. Read More.
• Positive Sentiment: Raised revenue guidance: Management updated near-term and FY26 revenue guidance above consensus, giving clearer top-line momentum and supporting the stock’s move. Read More.
• Positive Sentiment: Commercial contract wins and distribution deal: Thai Airways selected AAR’s Trax & Aerostrat for a digital MRO upgrade, and AAR began an exclusive commercial distribution agreement with TRIUMPH — both support recurring services/SaaS and aftermarket revenue. Read More. Read More.
• Positive Sentiment: Analyst and institutional support: Multiple buy/overweight ratings and recent large institutional additions lift sentiment and provide potential upside vs. peers. Read More.
• Neutral Sentiment: Improving cash flow & liquidity: Operating cash flow and cash balances improved year-over-year and liabilities edged down; this strengthens optionality for M&A or working capital but is not an immediate catalyst.
• Negative Sentiment: Insider selling: CEO John McClain Holmes III sold 23,077 shares (~$1.94M) on Jan. 2, reducing his reported stake ~8.9%. The sale — part of a broader pattern of executive sales noted in filings — can create short-term investor caution. Read More.

Analyst Ratings Changes

A number of analysts recently weighed in on AIR shares. Jefferies Financial Group began coverage on shares of AAR in a research report on Wednesday, December 17th. They set a “buy” rating and a $100.00 price target for the company. Zacks Research cut AAR from a “strong-buy” rating to a “hold” rating in a research note on Wednesday, October 29th. Wall Street Zen raised AAR from a “hold” rating to a “buy” rating in a research report on Saturday. KeyCorp upped their price target on AAR from $86.00 to $93.00 and gave the stock an “overweight” rating in a report on Monday, September 29th. Finally, Truist Financial increased their price objective on shares of AAR from $81.00 to $90.00 and gave the company a “buy” rating in a research report on Wednesday, September 24th. Four research analysts have rated the stock with a Buy rating and two have issued a Hold rating to the company. Based on data from MarketBeat.com, AAR presently has a consensus rating of “Moderate Buy” and an average target price of $93.25.

Insider Transactions at AAR

In other AAR news, CEO John Mcclain Holmes III sold 23,077 shares of the company’s stock in a transaction that occurred on Friday, January 2nd. The stock was sold at an average price of $84.12, for a total value of $1,941,237.24. Following the transaction, the chief executive officer directly owned 237,064 shares of the company’s stock, valued at $19,941,823.68. This represents a 8.87% decrease in their position. The sale was disclosed in a document filed with the SEC, which is available at the SEC website. 3.60% of the stock is owned by corporate insiders.

Institutional Trading of AAR

A number of hedge funds have recently made changes to their positions in the stock. Arrowstreet Capital Limited Partnership bought a new position in AAR during the 3rd quarter valued at $5,584,000. California State Teachers Retirement System increased its position in shares of AAR by 1.0% in the 2nd quarter. California State Teachers Retirement System now owns 33,178 shares of the aerospace company’s stock worth $2,282,000 after purchasing an additional 341 shares during the last quarter. Qube Research & Technologies Ltd acquired a new stake in shares of AAR in the 3rd quarter valued at about $2,396,000. BNP Paribas Financial Markets lifted its position in shares of AAR by 314.6% during the second quarter. BNP Paribas Financial Markets now owns 26,860 shares of the aerospace company’s stock worth $1,848,000 after purchasing an additional 20,382 shares during the last quarter. Finally, Two Sigma Investments LP grew its stake in AAR by 9.3% in the third quarter. Two Sigma Investments LP now owns 11,700 shares of the aerospace company’s stock worth $1,049,000 after purchasing an additional 994 shares in the last quarter. Institutional investors and hedge funds own 90.74% of the company’s stock.

AAR Company Profile

AAR Corp. (NYSE: AIR) is a global provider of aviation products and services to commercial, government and defense customers. The company offers a comprehensive portfolio of maintenance, repair and overhaul (MRO) solutions, component repair and overhaul, and engineering services designed to support a wide variety of fixed-wing and rotary aircraft. Leveraging FAA and EASA certifications, AAR delivers turnkey maintenance programs and ad hoc repair services that enhance aircraft availability and reliability.

In its Aviation Supply Chain Services segment, AAR sources, stores and distributes parts for both commercial airlines and military operators.