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Air Lease (AL) Stock Down 0.3% Despite Q2 Earnings Beat

Air Lease Corporation ALstock has declined 0.3% since its second-quarter 2022 earnings release on Aug 4. The company reported better-than-expected earnings and revenue performance.

Quarterly earnings of 95 cents per share surpassed the Zacks Consensus Estimate of 79 cents. The bottom line surged 26.7% year over year on the back of increase in revenues.

Total revenues of $557.7 million outperformed the Zacks Consensus Estimate of $545.8 million. The top line jumped 13.4% year over year owing to the persistent growth in the company’s fleet and the recognition of cash basis revenue of $8.7 million. The uptick was, however, partially offset by the loss of rental revenue from the termination of the company’s leasing activities in Russia during the first quarter of 2022 and lower aircraft sales, trading and other revenues.

Air Lease Corporation Price, Consensus and EPS Surprise

Air Lease Corporation price-consensus-eps-surprise-chart | Air Lease Corporation Quote

Other Statistics

Revenues from rental of flight equipment climbed 20.6% year over year to $545.27 million in the reported quarter. However, revenues from aircraft sales, trading activity and other sources declined 68.8% from the year-ago quarter to $12.43 million.

Operating expenses rose 9.4% to $412.8 million, mainly due to higher depreciation of flight equipment costs.

As of Jun 30, 2021, Air Lease owned 392 aircraft with a net book value of $23.5 billion. Total fleet size at the end of first quarter was 911 (including owned fleet of 392) compared with 908 at the end of March 2022.

Liquidity

Air Lease exited the second quarter with cash and cash equivalents of $1.01 billion compared with $1.49 billion at March-2022 end. As of Jun 30, 2022, AL had $18.34 billion of debt financing and net of discount and issuance costs compared with $17.82 billion as of Mar 31, 2022.

At the end of the reported quarter, Air Lease had a strong liquidity position of $7.6 billion, which should help AL tackle coronavirus-induced challenges efficiently.

Dividend Update

Air Lease’s board approved a quarterly cash dividend of 18.5 cents per share, payable on Oct 7 to its shareholders of record as of Sep 12.

Currently, Air Lease carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Transportation Companies

Delta AirLinesDAL second-quarter 2022 earnings (excluding 29 cents from non-recurring items) of $1.44 per share fell short of the Zacks Consensus Estimate of $1.71. Escalated operating expenses induced the earnings miss. Multiple flight cancellations in May and June also hurt results. The earnings miss disappointed investors, resulting in the stock shedding value in early trading. In the year-ago quarter, Delta incurred a loss of $1.07 per share when air-travel demand was not as buoyant as in the current scenario.

DAL’s revenues came in at $13,824 million, which not only beat the Zacks Consensus Estimate of $13,608.9 million and soared 94% from the year-ago quarter’s figure as air-travel demand rebounded from the pandemic lows. The uptick in air-travel demand in the United States can be gauged from the fact that 75.9% of second-quarter 2022 passenger revenues came from the domestic markets.

J.B. Hunt Transport Services, Inc. JBHTreported better-than-expected second-quarter 2022 results, wherein both earnings and revenues outperformed the Zacks Consensus Estimate.

JBHT’squarterly earnings of $2.42 per share surpassed the Zacks Consensus Estimate of $1.61 and improved 50.3% year over year.

JBHT’stotal operating revenues of $3,837.53 million also outperformed the Zacks Consensus Estimate of $2,908.37 million. The top line jumped 32% year over year on the back of strength across all segments. JBHT’s total operating revenues, excluding fuel surcharges, rose 21.2% year over year.

CSX Corporation (CSX)reported better-than-expected second-quarter 2022 results, wherein both earnings and revenues outperformed the Zacks Consensus Estimate.

CSX’s quarterly earnings of 50 cents per share (excluding 4 cents from non-recurring items) beat the Zacks Consensus Estimate of 47 cents and improved 25% year over year.

CSX’s total revenues of $3,815 million outperformed the Zacks Consensus Estimate of $2,990 million. The top line increased 28% year over year on the back of higher revenues in almost all markets, driven by pricing gains, fuel surcharge, and contribution from the acquisition of Quality Carriers. CSX’s overall revenues per unit increased 27%.


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