Thomas Lott
Long/short equity, deep value, special situations, hedge fund manager

Aircastle Limited: Significantly Undervalued At 6x Earnings, Sports A 6.0% Dividend Yield

Aircastle Limited (NYSE:AYR) is a lessor of freighter and passenger aircraft, substantially underappreciated by the market on residual liquidity fears and poor technicals. Its biggest holder and the founder of the business, Fortress Investment Group (NYSE:FIG), has finally exited its position after a secondary offering this summer, as well as via direct share buybacks in the third quarter of this year.

Going forward, the lack of selling pressure from Fortress as well as a $50mm buyback plan should provide support for AYR stock. Even better, Aircastle's earnings prospects look particularly strong over the next 12 months as lower cost debt in addition to growth in new aircraft indicate that earnings next year likely beat Street estimates...

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