Tuesday, JMP Securities maintained a Market Outperform rating on FTAI Aviation stock (NASDAQ: FTAI) with a stable price target of $190.00. The stock, which has delivered an impressive 176% return over the past year according to InvestingPro data, currently trades at $126.51 with analyst targets ranging from $132 to $300. This confirmation followed FTAI Aviation's announcement on Monday that it is initiating a Strategic Capital initiative.
The initiative is a collaborative venture managed by FTAI alongside third-party institutional investors, which may include alternative asset managers with private credit platforms. With a robust current ratio of 3.86 and strong revenue growth of 37% in the last twelve months, the company appears well-positioned for this expansion.
The new partnership will primarily aim to acquire on-lease 737NG and A320ceo aircraft. FTAI Aviation anticipates that the current market conditions will facilitate an annual deployment of more than $3 billion. As part of the initiative's launch, FTAI Aviation plans to sell approximately 46 on-lease narrowbody aircraft to the partnership for an estimated sum of $550 million by the end of the second quarter of 2025.
FTAI Aviation's strategy includes an exclusive agreement where all engines owned by the partnership will be powered through engine/module exchanges via FTAI's MRE business. This arrangement is expected to generate consistent contractual earnings for FTAI Aviation from a long-term and expanding source.
Furthermore, FTAI Aviation will also contribute as a minority investor in the partnership, although the specific terms of this investment have not been disclosed. The company's move to create a minority stake in the partnership aligns with its broader strategy to leverage its existing MRE business and expand its market presence in the aviation leasing industry. For deeper insights into FTAI's financial health and growth prospects, including 15 additional ProTips and comprehensive valuation metrics, visit InvestingPro.
In other recent news, FTAI Aviation has been making strategic moves to bolster its growth. The company launched a significant capital initiative, partnering with 3P private credit to invest in mid-life Boeing (NYSE:BA) 737NG and Airbus A320ceo aircraft. This initiative is expected to deploy approximately $3 billion of capital annually. FTAI Aviation also sold 46 on-lease narrowbody aircraft for around $549 million as part of this broader strategic plan.
The company has also provided financial guidance for fiscal year 2025, projecting an Adjusted EBITDA of approximately $1.1 to $1.15 billion. This forecast exceeds both the current estimate and consensus, suggesting a positive outlook for the company's financial performance.
Analysts from Compass Point, Jefferies, BTIG, Deutsche Bank (ETR:DBKGn), and Stifel have maintained their Buy ratings on FTAI Aviation. RBC Capital Markets has also made significant changes in the Aerospace & Defense sector, including upgrades and downgrades of various companies.
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