Comparing AerCap (AER) & Its Competitors
by Danessa Lincoln · The Markets DailyAerCap (NYSE:AER – Get Free Report) is one of 158 publicly-traded companies in the “Trading Companies & Distributors” industry, but how does it compare to its rivals? We will compare AerCap to similar businesses based on the strength of its valuation, profitability, dividends, risk, earnings, analyst recommendations and institutional ownership.
Profitability
This table compares AerCap and its rivals’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| AerCap | 34.47% | 18.33% | 4.72% |
| AerCap Competitors | 1.15% | -33.26% | 3.54% |
Dividends
AerCap pays an annual dividend of $1.60 per share and has a dividend yield of 1.0%. AerCap pays out 8.2% of its earnings in the form of a dividend. As a group, “Trading Companies & Distributors” companies pay a dividend yield of 2.6% and pay out 34.8% of their earnings in the form of a dividend. AerCap has increased its dividend for 2 consecutive years.
Institutional & Insider Ownership
96.4% of AerCap shares are held by institutional investors. Comparatively, 51.1% of shares of all “Trading Companies & Distributors” companies are held by institutional investors. 0.5% of AerCap shares are held by insiders. Comparatively, 17.1% of shares of all “Trading Companies & Distributors” companies are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
Volatility and Risk
AerCap has a beta of 0.98, meaning that its stock price is 2% less volatile than the S&P 500. Comparatively, AerCap’s rivals have a beta of 1.28, meaning that their average stock price is 28% more volatile than the S&P 500.
Analyst Recommendations
This is a breakdown of current ratings and target prices for AerCap and its rivals, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| AerCap | 0 | 2 | 8 | 1 | 2.91 |
| AerCap Competitors | 1464 | 4954 | 6821 | 238 | 2.43 |
AerCap currently has a consensus price target of $181.89, suggesting a potential upside of 11.15%. As a group, “Trading Companies & Distributors” companies have a potential upside of 8.29%. Given AerCap’s stronger consensus rating and higher possible upside, equities research analysts clearly believe AerCap is more favorable than its rivals.
Earnings and Valuation
This table compares AerCap and its rivals top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Net Income | Price/Earnings Ratio | |
| AerCap | $8.52 billion | $3.75 billion | 8.39 |
| AerCap Competitors | $6.75 billion | $360.25 million | 33.21 |
AerCap has higher revenue and earnings than its rivals. AerCap is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.
Summary
AerCap beats its rivals on 11 of the 15 factors compared.
About AerCap
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 and engines; 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. In addition, the company 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. Further, it offers airframe and engine parts and supply chain solutions to airlines; maintenance, repair, and overhaul service providers; and aircraft parts distributors. The company had a portfolio of owned, managed, or on order aircraft. AerCap Holdings N.V. was founded in 1995 and is headquartered in Dublin, Ireland.