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Fundamental analysis: AerCap Holdings N.V. (AER)

Awarener score: 4.3

Conclusion

The higher the Awarener score, the more bang you get for the buck. It measures how much genuine funds the company generates for the stock price paid (Modest), the business stability (Average) and growth (Lacking), and the company's inclination to return cash to the stockholders (Very poor).

Note: All scores range from 1 (worst) to 10 (best). Conclusions are updated daily with closing stock prices and new reported quarterly financial statements.

Revenue score: 5.0

  • Business has been slightly shrinking. It's been weak when measured against peer companies.
  • AerCap Holdings N.V. business trend stability is run-of-the-mill. The higher the stability, the lower the risk. It looks slightly worse than rivals.

Margins score: 8.3

  • AER profit margins -on goods and services sold- are usually excellent. They stand slightly better than rival companies.
  • Business profit on sales tends to be huge. It's top tier when measured against competitors.
  • Profits on sales made -available to repay debt and purchase properties- are usually excellent. They remain excellent in relation to peers.
  • Earnings -before income taxes and interests on loans taken- tend to be very good in relation to total revenues. They're still somewhat better than similar companies.
  • Profits -before income taxes- are usually good considering total sales, and remain similar to rivals.
  • Total net profit tends to be good when confronted to sales. Company stands encouraging in relation to comparable firms.

Growth score: 1.9

  • AerCap Holdings N.V. profit -on goods and services sold- has been growing at a very low pace. It's been lacking compared to competitors.
  • In recent years, earnings growth -on operations- have been almost stagnant, which has been mediocre against comparable firms.
  • Profits -available to repay debt and purchase properties- tended to shrink, which compares substantially worse when measured against peer enterprises.
  • In the previous years, the firm couldn't always make a profit -before income taxes and interests on loans taken-. It turns to be a disappointment compared to similar stocks.
  • In past years, at least once the company lost money -before income taxes-. It was bottom tier against rivals.
  • In the previous years, the firm had at least a total net loss, and last-in-rank when measured against peer companies.
  • The company lost money at least once in the past years. It's been a disappointment compared to industry peers.

Miscellaneous score: 7.0

  • AER had hardly to pay income taxes in relation to profits made in the past years. It's been worse than most peers.
  • The company does not report R&D expenses. It's meaningless to measure in relation to competitors.
  • We have insufficient data to estimate how effective is research and development effort. It stands unknown against rival companies.

Profitability score: 5.8

  • AerCap Holdings N.V. usually gets sufficient returns on the resources it controls. It proves below average when measured against peer firms.
  • The company normally gets hardly sufficient proceeds -on the resources directly invested in the business-. They remain in a weak position compared to similar companies.
  • There's usually some profitability -in relation to owned resources-. It ranks weak when measured against competitors.
  • In the past, got sufficient returns -on the tangible resources it controls-. This metric is usually related to the industry in which operates and combines profitability versus reinvestment needs. It's below average when measured against comparable enterprises.

Usage of Funds score: 4.3

  • AER usually uses almost all genuine funds generated to buy or replace property, plant, or equipment. The need for reinvestments is huge. It stands below average when measured against rival firms.
  • The company is usually largely investing in new property, plant, and equipment, to expand its operating capabilities, which is encouraging in relation to industry peers.
  • In the past twelve months the stock paid no dividends. It came bottom tier against competitors.
  • The company pays no dividend, so measuring its growth is meaningless. The company has behaved in an conservative way compared to similar firms.
  • As no dividends are paid, it is useless trying to estimate their sustainability in time. Sustainability looks not applicable in regard to comparable companies.
  • The company barely enlarges the pool of investors, resulting in slightly more mouths feeding on the pie of profits. It remains close to average when compared to peer enterprises.
  • Repurchase effectiveness metric is very complex. Run again in analytical mode if you're interested in a technical explanation. It stands close to average when compared to rivals.
  • The company uses a lot more funds to reward investors than it can genuinely generate, so they're paid out of existing cash or by borrowing money, both of which will eventually reach a limit. Either business improves, or rewards won't keep at current pace. It still looks substantially worse when measured against competitors.

Balance Sheet score: 4.1

  • AerCap Holdings N.V. intangible assets (like brands and goodwill) represent a modest portion of resources controlled, according to accounting books. There could be some difficulties in liquidating them if the company ever gets in financial distress. It happens to be almost average when measured against peer companies.
  • The company has more short-term resources than short-term obligations. Liquidity concerns shouldn't be an issue. It turns to be rather normal in relation to similar firms.
  • Most resources controlled were provided for with financial debt. Creditors have more claims on the company than shareholders. Unless the company is a financial institution that takes deposits, the situation might be very risky. It remains somewhat worse than rival firms.
  • Controlled resources take time to be turned into cash and equivalents, which is somewhat risky. It looks almost average when measured against rivals.
  • For every dollar of short-term obligations, the company has enough dollars in cash and short-term receivables. It's rather normal in relation to peer firms.
  • For every dollar of short-term obligations, the company has few cents of cash and equivalents, which is slightly worse than similar enterprises.
  • Usually, sales are on many months credit. It still ranks last-in-rank when measured against peers.
  • Normally has approximately only a couple of weekly sales worth in inventory. It comes up as rather normal in relation to competitors.
  • On average, it takes a lot of months from the purchase to charging customers. It happens to be bottom tier against peers.
  • On average pays suppliers approximately four months or higher after the purchase. It ranks more than average in relation to industry peers.
  • The company pays its suppliers four months or more before charging its customers, so there's significant money invested in working capital. It's in a very weak position compared to similar companies.
  • Usual business earnings barely cover net interest expenses. Creditors may be earning money by assuming risks, but hardly shareholders. Situation is risky, profitability must increase, or additional stockholders' funding will eventually be required. It stands worse than most rival firms.
  • Business earnings have usually been extremely low when measured against loans taken. Even severely cutting back reinvesting in the business, it could take more than twenty years to repay the obligations. Additional stockholders' funding may be a quicker way, but at the cost of increasing the mouths to feed on the eventual pie of profits. It ranks substantially worse when measured against comparable enterprises.
  • The company didn't have revenues in the past twelve months. It must start having income to take advantage of used resources. It looks a disappointment compared to similar firms.
  • Resource exploitation is very low when yearly sales are considered, business volume must be greatly increased. This metric is normally tied to the industry where the firm belongs. It's still bottom tier against peer companies.

Valuation score: 4.5

  • AerCap Holdings N.V. reported losses, so valuating it in relation to earnings is meaningless. It happens to be last-in-rank when measured against competitors.
  • Price-to-Tangible-Book-Value is a fairly complex metric. Run again in analytical mode if you're interested in a technical explanation. It remains in good shape compared to peers.
  • In the past twelve months, the company generated some good free funds in relation to the stock price, which stands better than most similar companies.
  • In the past years the company barely generated enough genuine funds to cover up for its business needs. Business prospects should improve to be in a better position to reward investors. It's still encouraging in relation to industry firms.
  • In the past twelve months, the company has largely enlarged the pool of investors by issuing new shares. Future profits need to be high enough to justify the measure, as the pie of earnings will now be split among a lot more stockholders. It came up in a very weak position compared to peer ventures.
  • The company is drowned in loans. It almost belongs more to the creditors than the stockholders. The situation may be dire. It looks bottom tier against similar enterprises.
  • Considering the past twelve months, traditional Price-to-Earnings relation has been negative, as the company lost money. It ranks last-in-rank when measured against peer companies.
  • Comparing the current stock price with the past twelve-months revenues gives a roughly two to one relationship. This is an important metric to check its evolution through time, and to compare to industry peers. It looks in a weak position compared to rival firms.
  • The stock price is at or below the accounting book value. Unless profitability is really low, the stock may be selling a t a discount. Pay attention to the other key indicators for hints. The company remains top-notch against peer firms.
  • In the past twelve months, the operating business lost some money. It happens to be substantially worse when measured against industry peers.
  • In an alternate metric of bang for the buck, the company has usually shown a mediocre earnings power ability when measured against the current stock price and financial position. It's still in a weak position compared to peer companies.

Total score: 5.1


AER logos

Company at a glance: AerCap Holdings N.V. (AER)

Sector, industry: Industrials, Rental & Leasing Services

Market Cap: 11.74 billions

Revenues TTM: 5.44 billions

AerCap Holdings N.V. engages in the lease, financing, sale, and management of commercial flight equipment in China, Hong Kong, Macau, the United States, Ireland, and internationally. The company offers aircraft asset management services, such as remarketing aircraft and engines; collecting rental and maintenance rent payments, monitoring aircraft maintenance, monitoring and enforcing contract compliance, and accepting delivery and redelivery of aircraft and engines; and conducting ongoing lessee financial performance reviews. Its aircraft asset management services also include periodically inspecting the leased aircraft; coordinating technical modifications to aircraft to meet new lessee requirements; conducting restructuring negotiations in connection with lease defaults; repossessing aircraft and engines; arranging and monitoring insurance coverage; registering and de-registering aircraft; arranging for aircraft and engine valuations; and providing market research services. The company also provides cash management services, including treasury services, such as the financing, refinancing, hedging, and ongoing cash management of vehicles; and administrative services comprising accounting and corporate secretarial services consisting of the preparation of budgets and financial statements. In addition, it offers airframe and engine parts and supply chain solutions to airlines; maintenance, repair, and overhaul service providers; and aircraft parts distributors. As of December 31, 2021, the company had a portfolio of 2,369 owned, managed, or on order aircraft. AerCap Holdings N.V. was founded in 1995 and is headquartered in Dublin, Ireland.

Awarener score: 4.3

Conclusion

The higher the Awarener score, the more bang you get for the buck. It measures how much genuine funds the company generates for the stock price paid (Modest), the business stability (Average) and growth (Lacking), and the company's inclination to return cash to the stockholders (Very poor).