Aircastle Limited (NYSE:AYR)

CAPS Rating: 5 out of 5

A global company that acquires and leases high-utility commercial jet aircraft to passenger and cargo airlines throughout the world.


Player Avatar Eli4Prez (57.04) Submitted: 9/28/2012 5:42:57 PM : Outperform Start Price: $10.15 AYR Score: +30.52

Please stay below $12.00 so I can continue to gobble up cheap shares with a 5% dividend, a P/E under 8 (lower than competitors), 6 consecutive positive surprise earnings, a rising net balance sheet, and investment companies done with their secondary offering. I will buy this all day long under $12.00.

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Member Avatar nilini (< 20) Submitted: 10/4/2012 12:54:22 PM
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Eli4Prez, have agreed with you for the past 3 years. AYR has been getting the job done consistently. What I'm trying to understand now, though, is the effect of the secondary offering announced Aug 8. The release said:

"Co announced that it was informed by certain funds managed by affiliates of Fortress Investment Group LLC that such funds are offering 9.25 common shares pursuant to Aircastle's shelf registration statement which was previously filed with the Securities and Exchange Commission. Aircastle will not sell any shares in the offering and will not receive any proceeds from the offering. Goldman, Sachs & Co. is acting as underwriter for the offering."

Unfortunately, I don't know what a shelf registration actually does. "Co was informed"-? "Aircastle will not sell any shares in the offering and will not receive any proceeds from the offering." Can anyone educate me as to how this works exactly? Did Fortress hold warrants or something in exchange for providing financing? Looks like our shares are being diluted without any offsetting benefit to the company.

Member Avatar Eli4Prez (57.04) Submitted: 10/30/2012 6:22:44 PM
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I was actually referring to Fortress Investment Group when I mentioned "investment company done with it's secondary offering." I should have said, investment company done selling their ownership. I am not an expert here but the gist is that Fortress Investments owned a large stake of the Aircastle shares and now they're done selling their stake. They just needed to inform Aircastle and the public of the future sale I assume because they were greater than 10% owners - (I believe Fortess owned something like 16% of the shares as of June.)

So no, there is no additional dilution or negative consequence other than the fact that so many shares were being sold for a while which may have held the price down a little. That's over now though.

Member Avatar nilini (< 20) Submitted: 3/5/2013 1:08:21 PM
Recs: 0

Just realized I never thanked you for your answer. It made sense, and I did not sell my shares, which now I'm glad about. I'm also hoping the grounding of the Dreamliner means a little extra business for AYR.

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