Investment Thesis
Air Lease demonstrates exceptional fundamental strength with robust profitability (36.1% net margin, 45.4% operating margin) and substantial free cash flow generation ($1.5B FCF with 49.6% margin). The 810.5% revenue growth coupled with 179% EPS growth signals strong operational leverage and market demand, while the company maintains a healthy 7.0x interest coverage ratio despite significant leverage.
AL Strengths
- Exceptional profitability with 36.1% net margin and 45.4% operating margin
- Strong free cash flow generation of $1.5B with 49.6% FCF margin demonstrates cash conversion efficiency
- Robust revenue growth of 810.5% YoY with EPS growth of 179% indicating operational leverage and market momentum
- Solid interest coverage ratio of 7.0x provides adequate debt servicing capability
- Positive operating cash flow of $1.7B substantially exceeds capital expenditure needs
- High insider activity with 26 Form 4 filings in last 90 days suggests management confidence
AL Risks
- High financial leverage with 2.33x debt-to-equity ratio and $19.7B long-term debt representing 61% of total assets creates vulnerability to interest rate increases and economic downturns
- Extraordinary revenue growth of 810.5% may not be sustainable and could indicate one-time revenue recognition or business model shifts requiring validation
- Low ROA of 3.3% relative to asset base of $32.9B suggests capital intensity and potential asset quality concerns in equipment lease portfolio
- Equipment leasing industry exposure to cyclical economic conditions, airline/aviation sector volatility, and aircraft demand fluctuations
- Modest cash position of $466.4M represents only 1.4% of total assets, limiting financial flexibility despite strong cash generation
Key Metrics to Watch
- Lease portfolio quality and default rates on aircraft equipment leases
- Ability to sustain high margins as revenue growth moderates to normalized levels
- Debt refinancing capacity and interest rate exposure on $19.7B long-term debt
- Free cash flow generation and capital allocation decisions (dividends vs debt reduction)
- Aircraft market conditions and utilization rates affecting lease valuations and revenues
AL Financial Metrics
AL Profitability Ratios
AL Balance Sheet & Liquidity
AL 5-Year Financial Trend
5-Year Trend Summary: AIR LEASE CORP's revenue has grown significantly by 231% over the 5-year period, indicating strong business expansion. The most recent EPS of $5.14 reflects profitable operations.
AL Growth Metrics (YoY)
AL Quarterly Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2025 | $44.5M | $102.9M | $0.82 |
| Q2 2025 | $53.0M | $102.9M | $0.81 |
| Q1 2025 | $49.0M | $107.9M | $0.87 |
| Q3 2024 | $55.3M | $102.9M | $0.82 |
| Q2 2024 | $57.8M | $102.9M | $0.81 |
| Q1 2024 | $18.4M | $107.9M | $0.87 |
| Q3 2023 | $19.9M | $110.4M | $0.90 |
| Q2 2023 | $12.4M | $116.3M | $0.95 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
AL Capital Allocation
AL SEC Filings
Access official SEC EDGAR filings for AIR LEASE CORP (CIK: 0001487712)