| Factor | Score | Distribution | Value | Avg | Rank |
|---|---|---|---|---|---|
Valuation | 42 | 25.9x | 17.8x | Around median | |
Growth | 93 | 19.0% | 7.1% | Top tier | |
Quality | 41 | 8.6% | 4.5% | Around median | |
Safety | 62 | 2.7x | 2.6x | Around median | |
Capital Return | 78 | — | 2.12% | Top tier | |
Momentum | 77 | 96.8% | 2.9% | Top tier | |
Sentiment | 47 | 4 | 3 | Around median |
Estimates — analyst targets and a simplified DCF, not investment advice.
Ten ratios that matter, each compared against its sector median and average — so you can see whether a number is rich or cheap relative to peers in the same sector.
AAR Corp. provides an integrated aviation aftermarket services platform combining parts supply, component and airframe repair, engineering solutions, and software. Its principal activities are divided among parts supply; repair, engineering and software; and government solutions. Commercial customers accounted for 73% of fiscal 2026 Q4 sales, versus 27% for government customers. The company benefits from new parts distribution, aircraft and component maintenance, repair and overhaul, government logistics contracts, and recurring software revenue from Trax and Aerostrat, with pilot testing beginning for the AI-powered Airvoyant platform.
Fiscal 2026 Q4 sales reached a record $928 million, up 26% year over year, including 13% organic growth. Adjusted earnings before interest, taxes, depreciation and amortization rose 27% to $116 million, and the margin improved from 12.4% to 12.5%, while adjusted diluted earnings per share increased 32% to $1.53. Parts supply generated $424 million in sales, repair, engineering and software generated $314 million, and government solutions recorded $130 million, equivalent to approximately 46%, 34% and 14% of total sales, respectively, with the remaining activities contributing the balance.
In fiscal 2026, adjusted sales rose 20% to $3.3 billion, including adjusted organic growth of 14%, while adjusted earnings before interest, taxes, depreciation and amortization increased 24%. The adjusted margin was 12.1%, or 12.7% excluding the legacy commercial programs business, while adjusted earnings per share rose 29% to $5.05. The company generated adjusted cash flow from operations of $58 million in fiscal 2026 Q4 and $94 million during fiscal 2026, while net leverage declined from 2.17 times at the end of Q3 to 2.03 times at the end of Q4.
The analyst consensus on AIR stock is “Buy,” with an average price target of $144 and a target range of $132 to $155. The average target is below the 52-week high of $154, while the highest target nearly matches it, and the wide spread between the lowest and highest targets reveals a meaningful difference in estimates of the pace of growth and margin improvement. No price-to-earnings ratio is available in the data, so the stock’s valuation here is based on the target range compared with the 52-week range of $73.05 to $154, while balancing strong fiscal 2026 growth against expected growth deceleration and pressure from the HAECO Americas integration.
Figures in the text are as of 2026-08-30; the live price is shown at the top of the page.
AAR’s sales reached a record $928 million in fiscal 2026 Q4, up 26% year over year with 13% organic growth. Parts supply grew 39% to $424 million, while repair, engineering and software sales rose 35% to $314 million. Growth came from new parts distribution, increased component and airframe repair work, the HAECO Americas acquisition, and higher recurring revenue at Trax. Adjusted diluted earnings per share rose 32% to $1.53.
For fiscal 2027, management expects sales growth, excluding the legacy commercial programs business, ranging from the low teens to the early teens. For fiscal 2027 Q1, it expects sales growth of between 21% and 23% and an adjusted earnings before interest, taxes, depreciation and amortization margin of between 12.25% and 12.75%. This outlook depends on continued strength in new parts distribution, growth in component repair, maintenance facility expansions entering service, and software expansion. The company also expects new, higher-margin government programs to offset the continuing decline in WASS activity.
AAR doubled Trax revenue from $25 million at the time of acquisition to $50 million and sees a clear path to $100 million before a longer-term target of $200 million for the software portfolio. The Trax implementation at Delta reached phase two, and the system is used by more than 10,000 Delta professionals. The company launched Airvoyant in April 2026, and the platform entered pilot testing with several airlines, benefiting from the Aeroxchange network, which connects approximately 5,000 suppliers with hundreds of airlines. Management also said Aerostrat’s performance in the heavy maintenance planning market has exceeded its expectations since the acquisition.
Automated analysis for informational purposes only — not investment advice.
The company’s adjusted earnings before interest, taxes, depreciation and amortization margin rose from 12.4% to 12.5% in fiscal 2026 Q4 and reached 13% excluding legacy commercial programs. However, the repair, engineering and software margin declined 50 basis points to 11.5%, as the integration of HAECO Americas had an impact of approximately 130 basis points and component repair costs had an impact of approximately 90 basis points. The parts supply margin also declined 250 basis points to 14.6% due to a previous nonrecurring gain of $6.5 million and pressures from used serviceable material. The company is targeting HAECO Americas facilities to reach margins comparable to its other locations in the second half of fiscal 2027.
New parts distribution grew organically by 19% in fiscal 2026 Q4, including organic growth of 28% in commercial distribution and 7% in government distribution. AAR signed an additional exclusive agreement with Woodward to distribute parts for LEAP, GEnX and CF34 engines, following previous cooperation in defense distribution. In March 2026, the company received a $305 million follow-on contract to support the U.S. Navy and Marine Corps C-40 fleet. In contrast, the continuing decline of the WASS program remains a challenge that requires sufficient growth in other government programs to offset it.
AAR generated adjusted cash flow from operations of $58 million in fiscal 2026 Q4 and $94 million during fiscal 2026. Net leverage declined from 2.17 times at the end of Q3 to 2.03 times at the end of Q4, despite financing the acquisition of Aircraft Reconfig Technologies during the quarter. Adjusted operating cash conversion was 50% of adjusted earnings before interest, taxes, depreciation and amortization in the quarter, but only 24% for the full year. Management is targeting more than 30% over multiple periods by reducing days sales outstanding and increasing inventory turnover.
