MODEL VERDICT
AAR Corp. (AIR)
Relative Valuation•Peer multiples, Monte Carlo simulation & quality-adjusted fair value
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Composite score derived from valuation, quality, and risk factors
Quantitative model thresholds · For educational and research purposes only
Each row records the model's monthly assessment. High Conviction = the model detected notable undervaluation vs peers. Neutral = no notable divergence was found. The return column shows the actual price change over 90 days for reference. This is a quantitative observation log — not investment advice.
| Date | Assessment | Score | Price | Status | 90d Fwd Return |
|---|---|---|---|---|---|
| May 1, 2026 | NEUTRAL | 0.17 | $110.35 | CURRENT | — |
| Apr 24, 2026 | NEUTRAL | 0.17 | $110.54 | CURRENT | — |
| Apr 17, 2026 | NEUTRAL | 0.17 | $123.04 | CURRENT | — |
| Apr 16, 2026 | NEUTRAL | 0.17 | $122.75 | CURRENT | — |
| Apr 10, 2026 | NEUTRAL | 0.16 | $120.83 | CURRENT | — |
Historical model observations for research purposes only. Past quantitative patterns do not predict future results. Not a recommendation to buy, sell, or hold any security.
| Methodology | Fair Value | vs Current | Weight | Quality | Status |
|---|---|---|---|---|---|
| Forward P/E 8 analyst estimates | $158.05 | +43.2% | 20% | A- | Analyst Est. |
| EV/EBITDA 8 industry peers | $139.02 | +26.0% | 20% | A- | Peer Data |
| Industry Median P/E 7 industry peers | $13.05 | -88.2% | 15% | A | Peer Data |
| Price / Free Cash Flow 5 industry peers | $1.01 | -99.1% | 15% | B+ | Peer Data |
| EV/EBIT 6 industry peers | $91.35 | -17.2% | 8% | B+ | Peer Data |
| EV To Revenue 8 industry peers | $489.07 | +343.2% | 4% | B | Data |
| Price / Sales 8 industry peers | $489.80 | +343.9% | 3% | B | Model Driven |
| Earnings Yield 8 industry peers | $14.46 | -86.9% | 2% | B | Data |
| FCF Yield 5 industry peers | $1.02 | -99.1% | 1% | B | Data |
| Weighted Output Blended model output | $72.85 | -34.0% | 100% | 54 | SIGNIFICANTLY OVERVALUED |
| EPS Growth ↓ | P/E Multiple → | 265× | 290× | 315× (Current) | 340× | 365× |
|---|---|---|---|---|---|
| Bear Case (2%) | $95 | $104 | $112 | $121 | $130 |
| Conservative (5%) | $97 | $107 | $116 | $125 | $134 |
| Base Case (-13.2%) | $81 | $88 | $96 | $103 | $111 |
| Bull Case (-18%) | $76 | $83 | $91 | $98 | $105 |
Cross-sectional regression predicting expected multiples based on growth, margins, ROIC, and beta.
| Multiple | Avg | Median | Min | Max | Std |
|---|---|---|---|---|---|
| P/E Ratio | 90.61 | 47.50 | 20.79 | 236.54 | 93.11 |
| EV/EBIT | 27.49 | 31.03 | 15.47 | 41.29 | 10.37 |
| EV/EBITDA | 14.96 | 15.08 | 12.01 | 18.48 | 2.76 |
| P/FCF | 469.44 | 31.48 | 14.67 | 2117.06 | 922.82 |
| P/FFO | 24.35 | 19.11 | 14.46 | 43.78 | 10.16 |
| P/TBV | 3.07 | 2.05 | 1.62 | 6.43 | 2.00 |
| P/AFFO | 38.27 | 28.23 | 17.10 | 89.81 | 24.92 |
| P/B Ratio | 1.77 | 1.74 | 1.40 | 2.45 | 0.37 |
| Div Yield | 0.01 | 0.01 | 0.00 | 0.01 | 0.00 |
| P/S Ratio | 0.89 | 0.89 | 0.61 | 1.10 | 0.17 |
Based on our peer multiples analysis with 24 valuation metrics, the model estimates AIR's fair value at $72.85 vs the current price of $110.35, implying -34.0% downside potential. Model verdict: Significantly Overvalued. Confidence: 54/100. This is a quantitative estimate, not a recommendation.
The blended fair value of $72.85 is calculated using four lenses: industry median multiples (40%), historical multiples (30%), forward estimates (20%), and quality-adjusted multiples (10%). Monte Carlo simulation (10,000 iterations) gives a range of $126.55 (P10) to $193.51 (P90), with a median of $159.07.
AIR's current P/E of 315.3x compares to the industry median of 37.3x (7 peers in the group). This represents a +745.5% premium to the industry. The historical average P/E is 90.6x over 7 years. Signal: High Premium.
20 analysts cover AIR with a consensus rating of Buy. The consensus price target is $120.00 (range: $105.00 — $135.00), implying +8.7% upside from the current price. Grade breakdown: Strong Buy (0), Buy (14), Hold (6), Sell (0), Strong Sell (0).
The model confidence score is 54/100, based on: data completeness (18), peer quality (25), historical depth (20), earnings stability (4), and model agreement (2). Cyclicality penalty: --15 points. The model shows moderate agreement across inputs.
The model flags several key risks: (1) Margin reversion: Current net margin of 5.5% is 4.3 percentage points above the 7-year average (4.3%), with a Z-score of +2.4σ. If margins normalize, fair value could drop to ~$25. (2) Multiple compression: AIR trades at the N/Ath percentile of its historical P/E range. A reversion to median (90.6×) would imply significant downside. (3) Macro/regulatory risks are not captured in this model but remain material.
Peak earnings risk refers to the possibility that AIR's current profitability is above its sustainable long-term trend. The model detects a margin Z-score of +2.4σ, meaning margins are 2.4 standard deviations above their historical average. If margins revert to the 7-year mean (4.3%), the model estimates fair value drops by 7710.0% to approximately $25. This isn't a prediction — it's a scenario analysis.
No. This dashboard is a quantitative research tool for educational and informational purposes only. It is not investment advice, a solicitation, or a recommendation to buy, sell, or hold any security. The operator of this platform is not a registered investment advisor (RIA), broker-dealer, or financial planner. All model outputs, fair value estimates, signals, and scenarios are the result of automated quantitative computations and should not be construed as professional financial guidance. You should consult a qualified, licensed financial advisor before making any investment decisions. Past model performance is not indicative of future results.