Value
7.6/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 9.7 |
| P/S | 8.5 |
| EV/EBITDA | 3.9 |
| Fwd P/E | 9.5 |
| PEG | 10.0 |
| Analyst target | 4.0 |
- ▸Forward P/E: 8.7x
- ▸PEG: 0.20
- ▸Attractively valued
AER · Why this verdict
Why AerCap Holdings (AER) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
Show full disclosure ▾Hide full disclosure ▴
About TrendMatrix. TrendMatrix is a publisher of general securities research and market commentary. We publish on a regular schedule. All content is the same for every subscriber in a tier — we do not provide personalized investment advice and we do not take into account any individual subscriber's financial situation, investment objectives, risk tolerance, tax situation, or holdings.
Not investment advice. TrendMatrix is not a registered investment adviser. Our content is for informational and educational purposes only. Consult your own licensed investment adviser, broker, or tax professional before making any investment decision.
Conflicts and positions. The TrendMatrix editorial team frequently holds personal long-term positions in securities discussed. We disclose positions held at the time of publication on each piece. We maintain a trading-window policy: we do not initiate or close positions in the same direction as a TrendMatrix publication within 24 hours before or 72 hours after publication.
No paid promotion. TrendMatrix does not accept payment from any issuer, broker, or third party in exchange for coverage of any security. Our sole compensation is subscription revenue.
No fiduciary duty. No fiduciary, advisory, or agency relationship is created between you and TrendMatrix by reading our content or subscribing to our service.
Performance. Past performance is not indicative of future results. Performance figures reflect the published model only and do not reflect any individual subscriber's actual results.
VerdictSELL
Overall score6.3/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
AerCap presents a compelling combination of deep value — forward price-to-earnings of 8.3x and a PEG ratio of 0.20 — with an exceptional earnings track record of four consecutive beats averaging 32% above consensus, yet the stock trades within 1.8% of the analyst take-profit target with a 0.37-to-1 reward-to-risk ratio; the underlying business quality is high but the entry geometry is unfavorable at current prices.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The company has beaten analyst EPS estimates in all four of the most recent quarters, with an average positive surprise of approximately 32% per quarter — including a 45% beat in the most recent period and a 61% beat two quarters prior — demonstrating a consistent pattern of reporting results well above what the market anticipates. Earnings | The next earnings report (approximately 43 days away) extends the perfect beat streak to a fifth consecutive quarter, with a positive EPS surprise of at least 10%, continuing to demonstrate that consensus estimates are being set well below actual delivery. | →Stable |
| CounterAnalysts may tighten their estimates to better reflect recent performance, compressing the gap between actuals and expectations; if the surprise magnitude shrinks to low single digits, a re-rating of the underlying multiple may not follow. | ||
The stock screens attractively valued at a forward price-to-earnings multiple of 8.3x and a PEG ratio of 0.20, indicating the market is pricing in little of the company's earnings growth; peer-ranking data confirm a superior return on equity versus comparable companies and an attractive P/E relative to the competitive set. Valuation breakdown | As the earnings beat streak continues, the valuation multiple expands from 8.3x toward 11-12x forward earnings over the next 12 months, narrowing the discount to the peer group and delivering price appreciation on top of already-strong reported earnings. | →Stable |
| CounterHigh leverage at a debt-to-equity ratio of 2.3, combined with negative free cash flow, may justify a persistent discount to peers; multiple expansion rarely occurs in leveraged businesses without a demonstrated improvement in cash generation. | ||
The stock has established a breakout configuration — a golden cross has formed, price is trading above all major moving averages, and the MACD indicator is in a bullish configuration — suggesting the technical setup supports the fundamental case for continued appreciation. V9 | Price continues to hold above all major moving averages over the next quarter, with on-balance volume remaining in an accumulation phase, confirming that institutional buying is supporting the breakout. | →Stable |
| CounterWith RSI at a mid-range reading, the stock has significant room to pull back before oversold conditions are reached; any deterioration in the fundamental or macro backdrop could quickly invalidate the technical setup from current levels. | ||
Despite strong reported earnings, free cash flow is negative at -23% of net income, indicating that reported profits are not yet converting into cash; at a debt-to-equity ratio of 2.3, the balance sheet carries meaningful leverage that amplifies downside if business conditions soften. Bear case | Free cash flow should turn positive and exceed 50% of net income over the next 12 months, reducing the divergence between reported earnings and actual cash generation and giving the balance sheet more cushion. | →Stable |
| CounterThe gap between reported earnings and cash generation may reflect the capital-intensive nature of the business model; if the gap narrows naturally over time, the leverage penalty may never translate into actual financial stress. | ||
The company has beaten analyst EPS estimates in all four of the most recent quarters, with an average positive surprise of approximately 32% per quarter — including a 45% beat in the most recent period and a 61% beat two quarters prior — demonstrating a consistent pattern of reporting results well above what the market anticipates.
→StableEarnings
- Expectation
- The next earnings report (approximately 43 days away) extends the perfect beat streak to a fifth consecutive quarter, with a positive EPS surprise of at least 10%, continuing to demonstrate that consensus estimates are being set well below actual delivery.
CounterAnalysts may tighten their estimates to better reflect recent performance, compressing the gap between actuals and expectations; if the surprise magnitude shrinks to low single digits, a re-rating of the underlying multiple may not follow.
The stock screens attractively valued at a forward price-to-earnings multiple of 8.3x and a PEG ratio of 0.20, indicating the market is pricing in little of the company's earnings growth; peer-ranking data confirm a superior return on equity versus comparable companies and an attractive P/E relative to the competitive set.
→StableValuation breakdown
- Expectation
- As the earnings beat streak continues, the valuation multiple expands from 8.3x toward 11-12x forward earnings over the next 12 months, narrowing the discount to the peer group and delivering price appreciation on top of already-strong reported earnings.
CounterHigh leverage at a debt-to-equity ratio of 2.3, combined with negative free cash flow, may justify a persistent discount to peers; multiple expansion rarely occurs in leveraged businesses without a demonstrated improvement in cash generation.
The stock has established a breakout configuration — a golden cross has formed, price is trading above all major moving averages, and the MACD indicator is in a bullish configuration — suggesting the technical setup supports the fundamental case for continued appreciation.
→StableV9
- Expectation
- Price continues to hold above all major moving averages over the next quarter, with on-balance volume remaining in an accumulation phase, confirming that institutional buying is supporting the breakout.
CounterWith RSI at a mid-range reading, the stock has significant room to pull back before oversold conditions are reached; any deterioration in the fundamental or macro backdrop could quickly invalidate the technical setup from current levels.
Despite strong reported earnings, free cash flow is negative at -23% of net income, indicating that reported profits are not yet converting into cash; at a debt-to-equity ratio of 2.3, the balance sheet carries meaningful leverage that amplifies downside if business conditions soften.
→StableBear case
- Expectation
- Free cash flow should turn positive and exceed 50% of net income over the next 12 months, reducing the divergence between reported earnings and actual cash generation and giving the balance sheet more cushion.
CounterThe gap between reported earnings and cash generation may reflect the capital-intensive nature of the business model; if the gap narrows naturally over time, the leverage penalty may never translate into actual financial stress.
Per-dimension breakdown
Quality
6.5/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 7.4 |
| ROA | 2.8 |
| Gross margin | 8.4 |
| Op margin | 10.0 |
| Net margin | 10.0 |
| Current ratio | 5.0 |
| FCF quality | 0.0 |
| Moat | 6.9 |
| Piotroski F | 7.8 |
- ▸Strong margins: 45%
- ▸Earnings quality RED FLAG: -23% FCF/NI
- ▸Strong Piotroski F-Score: 7/9
Growth
7.2/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 4.5 |
| EPS growth | 10.0 |
Momentum
6.6/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.2 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 9.0 |
| Volume | 0.0 |
- ▸Overbought (RSI 77)
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
Sentiment
5.5/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 6.6 |
| erm sentiment | 5.0 |
Insider
3.8/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 4.5 |
| insider conviction | 2.0 |
| holder change | 5.0 |
- ▸Modest insider selling — $19,115,821 (0.082% of mkt cap)
Peer rank
6.2/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 5.8 |
| quality rank | 9.0 |
| growth rank | 5.0 |
- ▸Attractive P/E vs peers
- ▸Superior ROE vs peers
Technical
3.3/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 0.4 |
| support resistance | 0.3 |
| 52w position | 9.3 |
Risk (lower is worse)
7.5/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 9.5 |
| days to cover | 10.0 |
| volatility | 6.2 |
| put call | 10.0 |
| implied vol | 6.7 |
| beta | 7.4 |
| debt equity | 2.7 |
Catalyst
7.2/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
| dividend safety | 6.0 |
- ▸Perfect beat streak: 4Q
- ▸Dividend: 108.0%
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (7)
- MOMENTUM:6.6>=5.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:33d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-0.3=NEGATIVE
Warning (0)
none
Reward-to-Risk
-0.31
Upside
-3.5%
Downside
11.4%
Sizing output
AVOID
SetupUNKNOWN — No clear chart pattern; technical signals are mixed
EdgeNO_EDGE — No clear edge identified
SuitabilityMODERATE — Balanced profile
Investment implication
The F-path SELL output reflects an overall score of 4.8 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Value at 7.6) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:-0.3=NEGATIVE) reinforce the read. Current asymmetry R:R is -0.31 — supplementary context, not the trigger for this path.
The strongest dimensions are Value at 7.6, Risk (lower is worse) at 7.5, and Growth at 7.2; the weakest are Technical at 3.3, Insider at 3.8, and Sentiment at 5.5. The V9 engine flagged 1 failed gate, producing an asymmetric reward-to-risk of -0.31 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1The company has beaten analyst EPS estimates in all four of the most recent quarters, with an average positive surprise of approximately 32% per quarter — including a 45% beat in the most recent period and a 61% beat two quarters prior — demonstrating a consistent pattern of reporting results well above what the market anticipates.
Trip ifEPS surprise stays below 0% for 2 consecutive quarters, breaking the four-quarter perfect beat streak.
- P2The stock screens attractively valued at a forward price-to-earnings multiple of 8.3x and a PEG ratio of 0.20, indicating the market is pricing in little of the company's earnings growth; peer-ranking data confirm a superior return on equity versus comparable companies and an attractive P/E relative to the competitive set.
Trip ifForward price-to-earnings multiple expands above 14x, indicating the valuation discount to peers has substantially closed.
- P3The stock has established a breakout configuration — a golden cross has formed, price is trading above all major moving averages, and the MACD indicator is in a bullish configuration — suggesting the technical setup supports the fundamental case for continued appreciation.
Trip ifMomentum score falls below 5.5 for 2 consecutive months, indicating the bullish technical backdrop has deteriorated.
- P4Despite strong reported earnings, free cash flow is negative at -23% of net income, indicating that reported profits are not yet converting into cash; at a debt-to-equity ratio of 2.3, the balance sheet carries meaningful leverage that amplifies downside if business conditions soften.
Trip ifFree cash flow rises above $0 for 2 consecutive reporting quarters, reducing the leverage risk embedded in this pillar.