Why AerCap’s new buyback and guidance matter for investors

AerCap Holdings (NYSE:AER) is back in focus after reporting a record quarter for aviation leasing, lifting its 2026 adjusted earnings guidance and authorizing a fresh US$1.0b share repurchase program.

The results highlight how management is using higher earnings, strong demand for aircraft assets and cash generation to return capital through both buybacks and a US$0.40 quarterly dividend, while several analysts reassess their views on the stock.

The stock is trading at US$148.49 after a 4.42% 7 day share price return and a 6.01% 90 day share price return, with a 38.24% 1 year total shareholder return suggesting momentum has been building over the longer term.

If AerCap’s recent buyback and guidance have you thinking about where else capital intensive themes could play out, it may be worth scanning 36 power grid technology and infrastructure stocks

With AerCap now trading near analyst targets and sitting on record earnings, the key question for you is whether the buyback and higher 2026 guidance still leave room for upside or if markets are already pricing in future growth.

Most Popular Narrative: 8.3% Undervalued

The most followed narrative currently sees AerCap’s fair value at $162, a touch above the last close at $148.49, and anchors that view in detailed earnings and margin assumptions.

Expansion of ancillary services, particularly AerCap's spare engine leasing and new engine/MRO partnerships such as the Air France-KLM JV, diversify revenue sources and add higher-margin income streams, positively impacting overall earnings growth.
Prudent capital allocation, supported by a strong balance sheet and ongoing deleveraging, positions AerCap to capture opportunities in sale-leasebacks and organic fleet growth as OEM deliveries ramp up. This is seen as driving revenue and earnings upside while containing interest expense.

Want to see what kind of revenue path and margin reset justify that fair value gap? The narrative leans on shrinking profits, steady sales, and a richer future earnings multiple.

Result: Fair Value of $162 (UNDERVALUED)

However, investors still need to weigh risks, such as a potential oversupply of aircraft and customer credit issues that could pressure lease rates, asset values, and earnings.

Another View: When DCF Paints A Different Picture

While the popular narrative sees AerCap as about 8.3% undervalued at a fair value of $162, the SWS DCF model points the other way, with an estimate of $92.53 that sits well below the $148.49 share price and identifies the stock as trading above its value based on projected cash flows.

This gap between earnings-based fair value and the DCF outcome puts the spotlight on your own assumptions about long-term cash generation, discount rates, and exit multiples, and raises a simple question: which story do you trust more when real money is on the line?

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out AerCap Holdings for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 51 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Next Steps

The mix of optimism and concern around AerCap is clear. If this has sharpened your curiosity, act now and weigh the upside against the downside by checking the 3 key rewards and 3 important warning signs

Looking for more investment ideas?

If AerCap has sharpened your focus, do not stop here. Broaden your watchlist with a few targeted ideas that could suit different goals and risk levels.

• Target potential long term compounders by scanning for companies trading below estimated value using the 51 high quality undervalued stocks.
• Strengthen your income stream by reviewing stocks with higher yields and resilient payouts through the 12 dividend fortresses.
• Dial back risk a notch by checking companies that screen well on stability and financial resilience in the 71 resilient stocks with low risk scores.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.