AAR Corp Q4 results beat estimates on strong parts supply growth
AIR•Outlook for fiscal 2027
AAR Corp sees Q1 FY2027 sales growth, excluding Legacy Commercial Programs (LCP), of 21% to 23%. The company expects Q1 FY2027 adjusted EBITDA margin, excluding LCP, of 12.25% to 12.75%. AAR Corp sees FY2027 sales growth, excluding LCP, in the low double-digits to low teens.
Analyst coverage and valuation
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 6 "strong buy" or "buy", 1 "hold" and no "sell" or "strong sell". The average consensus recommendation for the aerospace & defense peer group is "buy".
Wall Street's median 12-month price target for AAR Corp is $130.00, about 4.2% below its July 20 closing price of $135.69. The stock recently traded at 24 times the next 12-month earnings vs. a P/E of 20 three months ago.
Quarterly results beat estimates
AAR Corp's Q4 sales rose 23%, beating analyst expectations, while adjusted diluted EPS increased 32%, also beating analyst expectations.
| Metric | Beat/Miss | Actual | Consensus Estimate |
|---|---|---|---|
| Q4 Sales | Beat | $928 mln | $868.54 mln (7 Analysts) |
| Q4 Adjusted EPS | Beat | $1.53 | $1.38 (7 Analysts) |
| Q4 EPS | $1.27 | ||
| Q4 Net Income | $50.7 mln |
Growth in parts supply and repair segments
- Parts supply growth - Sales in the Parts Supply segment rose 39% in Q4, with new parts Distribution organic growth at 19%.
