Updated 4/13/25
Air Lease Corporation (NYSE: AL) is a global aircraft leasing company with a fleet of nearly 500 owned planes and long-term contracts with airline clients around the world. Led by a team with decades of industry experience, including CEO John Plueger and Executive Chairman Steven Udvar-Házy, the company focuses on securing modern aircraft and placing them under multi-year leases to generate steady cash flow. It’s a capital-intensive business with over $20 billion in debt, but the model is supported by consistent operating cash flow and a growing dividend. The stock currently trades around $41, below its 52-week high, and offers a forward dividend yield of 2.14%. With a low payout ratio, reasonable valuation metrics, and exposure to a recovering global travel market, Air Lease presents a structured opportunity for long-term investors looking for income and disciplined asset management.
Recent Events
Over the past year, Air Lease’s stock has taken a bit of a hit. It’s currently hovering around $41, a decent drop from its 52-week high of just over $52. That slide—about 14.6% over the year—comes despite broader market gains, which makes it a name worth watching for value-driven investors hunting for income.
Earnings have been mixed. The company is still profitable, reporting $3.33 in EPS over the last twelve months, but year-over-year quarterly earnings fell nearly 49%. That kind of drop might give growth investors pause, but it doesn’t tell the whole story. Operating cash flow remains strong at $1.68 billion, which is what matters more for those looking for sustainable dividends.
There’s also the matter of debt. With over $20 billion in total debt and a debt-to-equity ratio sitting north of 268%, leverage is a big part of how Air Lease operates. This is pretty normal in the aircraft leasing space. The company is essentially in the business of financing massive assets, so a capital-heavy balance sheet comes with the territory. Still, with interest rates higher than they’ve been in recent years, it’s something to keep an eye on.
Key Dividend Metrics
💵 Forward Annual Dividend Yield: 2.14%
📈 5-Year Average Yield: 1.80%
📆 Dividend Date: April 7, 2025
⚖️ Payout Ratio: 25.53%
🧮 Annual Dividend Rate: $0.88
⏱️ Ex-Dividend Date: March 18, 2025
Dividend Overview
Air Lease isn’t a high-yielder by any stretch, but it has been a consistent one. The current forward dividend yield of 2.14% edges out its five-year average, giving it a slight bump in attractiveness for investors seeking reliable income. The payout ratio is low—just over 25%—which is a good sign. It means the company is only handing out a small slice of its earnings, leaving plenty of breathing room.
When you’re dealing with a company that leases out aircraft over seven to twelve-year contracts, the cash flow predictability becomes a real asset. It doesn’t hurt that their aircraft are relatively new and efficient, making them attractive for lessees even during rougher patches in the aviation sector.
With over $2.7 billion in annual revenue and nearly $1.6 billion in gross profit, there’s enough meat on the bone to support ongoing dividend payments. The income stream may not be flashy, but it’s steady. And for many dividend investors, that’s exactly what you want.
Dividend Growth and Safety
There’s a quiet reliability to the way Air Lease approaches its dividend policy. The company has increased its annual payout every year since it initiated dividends. These aren’t massive hikes, but they’ve been dependable—proof of a management team that’s serious about returning value to shareholders while managing risk.
That 25% payout ratio is really where the safety story comes into focus. There’s more than enough cushion to maintain and even grow the dividend, especially with such solid operating cash flow. Yes, free cash flow on a levered basis is currently negative—mostly due to big spending on new aircraft—but that doesn’t impact dividend health when operating cash is this strong.
Air Lease also benefits from a very experienced management team, with deep roots in aircraft leasing. Founder Steven Udvar-Házy has been a titan in the space for decades. That background shows in the conservative approach the company takes—careful lease structuring, disciplined aircraft acquisitions, and a focus on high-quality lessees. It’s the kind of quiet competence dividend investors like to see.
Insiders hold around 6.7% of the stock, which helps align interests. And with institutions holding over 100% of the float due to short selling, it’s clearly on the radar of some serious market players.
The dividend here isn’t going to blow anyone away. But it’s real, it’s growing, and it’s built on a business model that keeps churning out income. For long-term investors looking for a stable, under-the-radar source of yield with room to grow, Air Lease might be one of those overlooked gems hiding in plain sight.
Cash Flow Statement
Air Lease Corporation’s trailing 12-month cash flow statement reflects the capital-intensive nature of its business model. Operating cash flow remains robust at $1.68 billion, showcasing consistent lease income and solid collections. That figure is in line with historical trends, proving the core business continues to generate steady cash. However, heavy investment in new aircraft is evident, with capital expenditures exceeding $4.5 billion, leading to negative free cash flow of nearly $2.9 billion.
On the financing side, the company raised $5.2 billion in new debt over the last year while repaying $4.1 billion, indicating an active debt management strategy. There was also a $250 million share repurchase, highlighting a commitment to shareholder returns despite significant capital outlays. The end cash position of $476 million is stable, though notably lower than two years ago. Overall, the company continues to rely on the debt markets to fund fleet expansion while maintaining sufficient operating inflow to cover its dividend and ongoing commitments.
Analyst Ratings
📉 In early March 2025, Bank of America revised its outlook on Air Lease Corporation, shifting the rating from “Buy” to “Underperform.” 🔻 The accompanying price target was lowered from $72 to $50. The downgrade was driven by mounting headwinds in the aircraft leasing space, particularly related to ongoing delivery delays from manufacturers and the increasing burden of financing costs. Air Lease’s reliance on receiving new aircraft as part of its growth strategy made it more vulnerable to these disruptions compared to peers with broader leasing portfolios.
🔍 While this specific downgrade stood out, the general tone among analysts remains more optimistic. 📊 The current average 12-month price target is around $55.67, with estimates ranging from $50 at the low end to as high as $65. That gives the stock a potential upside of roughly 35% from where it’s trading now. 🛫 Most analysts maintain a “Buy” rating, signaling continued belief in the company’s fundamentals and long-term runway for growth.
💼 The divergence in ratings underscores the complexity of the environment Air Lease operates in—where short-term operational hurdles exist but are not necessarily derailing the overall investment case in the eyes of the broader analyst community.
Earning Report Summary
Mixed Finish to the Year
Air Lease wrapped up 2024 with a performance that had a little bit of everything. The fourth quarter numbers came in a bit softer than expected, with revenue at $712.9 million—slightly below the same period last year. The drop was mostly tied to lower end-of-lease payments and fewer aircraft returns, both of which are fairly normal variables in their business. Net income came in at $92.5 million for the quarter, which was noticeably down from $210.6 million in Q4 of 2023. That decline wasn’t a surprise, though, considering last year’s numbers got a nice one-time lift from an insurance settlement that didn’t repeat this time around. Plus, the rising cost of debt has started to weigh more heavily on the bottom line.
Still Growing Underneath the Surface
Even with a softer quarter, the full-year picture told a different story. Air Lease hit record annual revenue of $2.73 billion, thanks to both aggressive aircraft acquisitions and strategic sales. The company bought about $5 billion worth of new aircraft during the year and sold another $1.7 billion worth from its existing portfolio. That kind of activity kept the fleet growing, closing the year with 489 owned aircraft and a total net book value topping $28 billion. The business remains very much in expansion mode, even while navigating higher financing costs and supply delays.
Leadership’s Take and What’s Ahead
CEO John Plueger shared a pretty upbeat message with investors. He pointed out that aircraft values and lease rates are likely to climb even further, mostly because supply from manufacturers continues to lag behind global demand. That’s good news for a lessor like Air Lease, which profits from owning and renting out those in-demand jets. He also mentioned something we haven’t heard in a while: wide-body demand is coming back. For a long stretch after the pandemic, airlines shied away from larger planes. But now, with international routes filling up again, those aircraft are making a comeback—and Air Lease has positioned itself to take advantage of that shift.
Looking forward, the company has a pipeline of aircraft deliveries lined up through 2029. That gives them a clear growth path, provided financing remains accessible and global travel trends keep moving in the right direction. It’s not without its risks, but leadership seems confident about the road ahead. All in all, while the quarter had some bumps, the long-term story for Air Lease still looks very much intact.
Chart Analysis
Price Action and Moving Averages
The stock chart for AL over the past year shows a fairly volatile ride, with multiple rallies and pullbacks. The price peaked above $52 twice—in late April and again around early December—before retreating each time. More recently, the price has broken sharply lower, dipping beneath $41 and tagging new 12-month lows. This downward move now places the price well below both the 50-day and 200-day moving averages, which is generally not a good technical look in the near term.
The 50-day moving average, shown in red, has been trending down for several months and has now crossed below the 200-day moving average—often seen as a bearish signal. The 200-day line, in blue, had been steadily rising through most of the year, but it’s started to flatten out, suggesting some long-term momentum is weakening.
Volume and Trading Behavior
Looking at the volume section, there’s a clear uptick in trading activity during recent downswings. Spikes in volume tend to show that larger market participants are repositioning. These high-volume down days suggest that sellers are becoming more aggressive, likely due to broader concerns or stock-specific disappointments.
That said, volume on rebound days remains modest, indicating that while there is some buying interest, it hasn’t been strong enough to shift momentum meaningfully.
RSI and Momentum
The Relative Strength Index (RSI) in the lower panel adds more color to what’s happening beneath the surface. For much of the year, RSI oscillated between 40 and 70, but in the last few weeks, it has dropped decisively below 30. That puts the stock in oversold territory.
Historically, when AL’s RSI has hit similar low levels, a short-term bounce has followed, but whether that turns into something more sustained depends on how the broader market views its fundamentals in the coming weeks.
Overall Structure
There’s a clear loss of support around the $44–$46 range, where the price had previously consolidated. Once that floor gave out in early April, selling accelerated. This kind of technical breakdown doesn’t reverse quickly unless accompanied by a strong catalyst or earnings surprise.
Until the stock can reclaim and hold levels above its major moving averages, particularly the 200-day, the chart doesn’t show signs of strength. The recent shift in momentum and volume suggest a cautious stance from the market, even as the RSI hints at short-term exhaustion on the sell side.
Management Team
Air Lease Corporation is led by a team with deep experience in the aircraft leasing industry. At the center of it is John L. Plueger, who serves as Chief Executive Officer and President. He brings decades of experience in aviation finance and was instrumental in co-founding Air Lease back in 2010 after spending many years at International Lease Finance Corporation. Alongside him is Executive Chairman Steven F. Udvar-Házy, who is considered one of the most influential figures in the global aircraft leasing world. His industry vision helped shape Air Lease from the ground up.
Supporting them is Gregory B. Willis, the company’s Chief Financial Officer and Executive Vice President. His financial oversight has been key in managing the company’s complex debt structure. Carol Forsyte rounds out the leadership team as General Counsel, EVP, and Chief Compliance Officer, overseeing legal and regulatory matters. Together, this group brings stability and insight, crucial in a capital-heavy business that requires a steady hand in both strategy and execution.
Valuation and Stock Performance
The stock for Air Lease (AL) has been bouncing within a wide range over the last year. As of mid-April 2025, shares are trading just over $41, down from highs near $52 but off the recent lows. That puts it squarely in the lower end of its 52-week range, which stretches from $38.25 to $52.31. The market seems cautious but not panicked, especially given the company’s current valuation.
From a metrics standpoint, AL’s valuation could be considered on the cheap side. Its trailing P/E ratio is 12.36, which reflects solid profitability for a business that’s still growing. The price-to-book ratio is just 0.61, suggesting the stock is trading well below its net asset value. Enterprise value to EBITDA sits at 14.05, showing that the company is valued fairly reasonably when considering its cash-generating ability.
Its total market cap is about $4.6 billion, but when you include debt, the enterprise value jumps to over $24 billion—an important detail in a business so dependent on financing. Despite the debt load, AL continues to return value to shareholders through its dividend, currently yielding just over 2.1% annually with a payout ratio under 26%, which leaves room for flexibility.
Risks and Considerations
There’s no ignoring the leverage on the balance sheet. With over $20 billion in debt and a debt-to-equity ratio approaching 270%, Air Lease operates with significant financial risk. This isn’t unusual in aircraft leasing, but rising interest rates mean the cost of rolling over debt is increasing. That’s something management will need to navigate carefully.
Another area to watch is aircraft supply. With ongoing delays from manufacturers like Boeing and Airbus, the company’s ability to take delivery of new planes and place them with customers can be affected. These delivery issues can delay expected revenue and affect capital deployment plans. While these are industry-wide problems, they’re very real for a company like AL that’s counting on future deliveries to drive growth.
The aviation sector itself is always vulnerable to global economic cycles. Recessions, oil price spikes, geopolitical tensions—all can affect airline profitability and leasing demand. While Air Lease has a broad and diversified customer base, it’s still exposed if major carriers cut back on fleet plans or run into financial trouble.
The long-term nature of its lease contracts does add a layer of stability, but if one of those clients defaults or goes under, it takes time to recover that aircraft and place it again—particularly in a weaker market.
Final Thoughts
Air Lease doesn’t chase attention, but it’s built to weather the long game. Its leadership team has deep roots in the business and a clear focus on disciplined growth. The stock trades at a valuation that offers some margin of safety, particularly for those who see value in long-term recurring cash flows. It’s not without its risks—especially around debt and interest rates—but the dividend is well-supported, and the overall strategy is grounded in managing a high-quality fleet with long-term leases.
With aircraft demand climbing again and delivery pipelines starting to normalize, Air Lease could be positioned well over the coming years. While it may take time for that value to be fully recognized by the broader market, the structure is there for sustainable income and eventual upside.