A little over a year ago, we wrote about the aircraft and jet engine leasing company AerCap (AER) in our March 2024 Special Situations Newsletter and added the company to our model portfolio. The summary of our thesis was as follows:
Summary
AerCap, an aircraft leasing company, is a share cannibal, having repurchased 15% of the company in the last five quarters and announcing two buybacks in less than three months.
Global travel trends have increased rapidly this past year but supply constraints at aircraft manufacturers gives AerCap (who built inventory early in the pandemic) an advantage.
AerCap has a history of growth through acquisitions of other aircraft leasing companies. The most notable ones were the 2014 acquisition of International Lease Finance Corporation and the 2021 acquisition of GE Capital Aviation Services.