Aircastle Limited Reports Strong 3Q EPS

Aircastle Limited AYR reported better than expected 3Q10 EPS of $0.22, compared with the consensus estimate of $0.20. Over the next few quarters the company will be adding next generation aircraft to its portfolio at attractive rates. Aircastle reported 3Q10 adjusted EPS of $0.22 vs $0.35 last year and compared to Dahlman's estimate of $0.24 and ahead of the consensus estimate of $0.22. Reported EPS of $0.11 vs $0.46 included one-time items in both years. During 2H10, management expects to conclude $500 million in aircraft investments, including two new A330-200Fs. The company also has about $700 million of additional growth over the next 18 months from the new A330 program. The company ended 3Q10 with $31 million of unrestricted cash on the balance sheet, which can be used opportunistically to expand the portfolio. Dahlman is maintaining its Buy Rating and raising its price target from $10 to $12 to reflect the changes in the aircraft portfolio made during 3Q10. AYR is trading flat at $9.42