NEW YORK - FTAI Aviation Ltd. (NASDAQ: FTAI), an aviation leasing and aerospace products company with a market capitalization of nearly $13 billion and an impressive 177% return year-to-date, has announced a new Strategic Capital initiative aimed at acquiring on-lease 737NG and A320ceo aircraft in partnership with third-party institutional investors. According to InvestingPro data, the company has demonstrated strong financial health with revenue growth of 37% over the last twelve months. The company estimates that this initiative will enable the deployment of over $3 billion in capital annually.
As part of the initiative's launch, FTAI has agreed to sell 46 on-lease narrowbody aircraft to the first partnership for an estimated net purchase price of $549 million. These engines will be powered exclusively through FTAI's Maintenance, Repair and Exchange (MRE) business.
The company has also released its initial financial guidance for the fiscal year 2025, projecting an Adjusted EBITDA of approximately $1.1 to $1.15 billion. This forecast is based on expected contributions of around $500 million from Aviation Leasing and $600 to $650 million from Aerospace Products. The company maintains a healthy liquidity position with a current ratio of 3.86, indicating strong ability to meet short-term obligations. InvestingPro subscribers can access 15+ additional key metrics and insights about FTAI's financial health. The guidance for 2025 includes assumptions of an average of 100 modules per quarter produced at the company's Montreal facility, net Aerospace margins at or above fiscal year 2024 levels, and 25 to 35 V2500 engine MRE transactions.
FTAI Aviation Ltd. specializes in owning and maintaining commercial jet engines, particularly CFM56 and V2500 engines. The company's portfolio includes the Module Factory and a joint venture for engine PMA manufacturing, aiming to provide cost savings and flexibility to its customer base, which includes airlines, lessors, and maintenance, repair, and operations services.
This announcement contains forward-looking statements regarding the annual deployment of capital, exclusive powering of engines through FTAI's MRE business, and the company's financial outlook for 2025. These statements are based on current plans and expectations and are subject to risks, uncertainties, and assumptions. Wall Street analysts maintain a bullish outlook on FTAI, with comprehensive analysis available in the InvestingPro Research Report, which provides detailed insights into the company's valuation, growth prospects, and market position among 1,400+ top US stocks.
The information for this article is based on a press release statement from FTAI Aviation Ltd.
In other recent news, RBC Capital Markets upgraded Hexcel (NYSE:HXL) Corporation and Raytheon (NYSE:RTN) Technologies (NYSE:RTX) Corp to 'Outperform' while downgrading General Dynamics Corp (NYSE:GD) and Vectrus Inc (NYSE:VVX) to 'Sector Perform'. The firm cited a favorable mix of aerospace revenue and positive market dynamics for the upgrades, while delivery timings and flat margin outlooks led to the downgrades. Analyst firms BTIG, Deutsche Bank (ETR:DBKGn), and Stifel maintained their Buy ratings on Fortress Transportation (NASDAQ:FTAI), with BTIG raising its target price to $180.
Fortress Transportation reported substantial growth in Q3 2024 with adjusted EBITDA reaching $232 million, a 50% increase from the same period last year. The leasing segment and aerospace products contributed $136.4 million and $101.8 million to the EBITDA, respectively. Moreover, the company sold its last two offshore energy vessels, Pioneer and Pride, for approximately $143 million, aligning with its commitment to concentrate on its aviation aftermarket business.
In a joint venture with Chromalloy, Fortress Transportation received Federal Aviation Administration (FAA) approval for a key engine component, which could potentially double the company's EBITDA per engine module and reduce engine shop visit costs. These developments highlight recent strides made by both Fortress Transportation and FTAI Aviation.
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