AerCap Holdings - Strong Q4 beats estimates; returning to asset growth in 2018

Davy Research
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AerCap’s Q4 results are another reminder of the solid and stable nature of its business and, looking into 2018, its $6bn capex programme will return it to asset growth. In an inflationary environment, we note that AerCap is asset-rich and well-hedged on interest rates (on both liabilities and forward placements, which have interest rate adjustments). Further, despite a track record of resilient ROE (12.5% in 2017), it continues to trade at an 8% discount to book value. We reiterate our ‘Outperform’ rating.