Why Is FTAI Aviation Stock Surging Today?

by Lekha Gupta Benzinga Editor

Zinger Key Points

FTAI Aviation partners with institutional investors on a $3B+ annual initiative for 737NG and A320ceo acquisitions.
FY25 adjusted EBITDA projected at $1.1B–$1.15B, with $500M from Aviation Leasing and $600M–$650M from Aerospace Products.
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FTAI Aviation Ltd. FTAI shares are trading higher premarket on Tuesday. On Monday, the company launched a strategic capital initiative in partnership with institutional investors.

The first partnership under the initiative will focus on acquiring 737NG and A320ceo aircraft and this market opportunity will allow for the deployment of over $3.0 billion of capital annually.

This initiative and partnerships will allow FTAI to maintain an asset-light model while the partnerships actively acquire on-lease narrowbody aircraft at scale.

As part of this initiative, FTAI has agreed to sell 46 on-lease narrowbody aircraft to the partnership for a net purchase price of $549 million.

All engines within the partnership will utilize FTAI’s Maintenance, Repair, and Exchange services.

Outlook: FTAI expects adjusted EBITDA from its reportable segments of $1.1 billion to $1.15 billion for FY25.

This includes around $500 million from Aviation Leasing and $600 to $650 million from Aerospace Products.

The company’s key assumptions include producing an average of 100 modules per quarter at the Montreal facility, maintaining or improving net Aerospace margins from 2024, and completing 25 to 35 V2500 engine MRE transactions in 2025.

As of September 30, 2024, cash and equivalents of $111.9 million.

Investors can gain exposure to the stock via Gabelli ETFs Trust Gabelli Financial Services Opportunities ETF (GABF) and Invesco Dorsey Wright Financial Momentum ETF PFI.

Price Action: FTAI shares are up 5.92% at $134.00 premarket at the last check Tuesday.

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