These are good days to be in the aircraft leasing business, and even if AerCap's (NYSE:AER) performance hasn't exactly set the world on fire since my last update it has at least beaten the market and its closest peer Air Lease (NYSE:AL).
Looking
ahead, the numerous projections out there of a decade-plus of 5% annual
global air passenger growth should be supportive of the leasing
industry. That said, I do worry that high margins and low rates could
lead to an influx of capital into the industry. What's more, I'd note
that this is an industry that has never really shown an ability to
generate positive economic returns across a full cycle. While I still
believe that AerCap is undervalued, and one of the best-run lessors in
the industry, I'd at least keep an eye on the entry of new players and
the trends in margins and ROE across the sector.
Continue here for the full article:
AerCap Making The Best Of A Good Situation
No comments:
Post a Comment