AAR (AIR) Is Up 7.1% After Swinging Back to Profit and Expanding Digital MRO Platforms

• AAR Corp. has reported fiscal second-quarter 2026 results, with sales of US$795.3 million and net income of US$34.6 million, reversing a loss a year earlier and lifting basic earnings per share from continuing operations to US$0.91.
• Alongside this earnings rebound, AAR is integrating recent acquisitions, executing its exclusive TRIUMPH distribution agreement, and expanding its Trax and Aerostrat software footprint, which together broaden its aviation services and digital solutions reach.
• Next, we'll examine how AAR's sharp earnings turnaround and growth in digital MRO platforms influence its existing investment narrative.

Trump has pledged to "unleash" American oil and gas and these 22 US stocks have developments that are poised to benefit.

AAR Investment Narrative Recap

To own AAR, you need to believe in its role as a diversified aviation services provider, balancing commercial and defense demand while scaling higher margin digital platforms. The sharp swing back to profitability in Q2 FY26 supports this thesis but does not fundamentally change the key near term catalyst, which remains execution on Trax and Aerostrat. The biggest current risk is still whether AAR can scale these digital offerings effectively without stumbling on implementation or integration.

The Thai Airways win for Trax and Aerostrat ties directly into that catalyst, showing AAR’s software being adopted to modernize a major flag carrier’s maintenance operations. It reinforces the idea that digital MRO solutions can deepen customer relationships and potentially improve earnings quality over time, but it also heightens the execution risk around delivering complex, mission critical software projects at scale for airlines with demanding operational requirements.

However, investors should also be aware that the growing dependence on successful digital rollouts...

Read the full narrative on AAR (it's free!)

AAR's narrative projects $3.2 billion revenue and $293.3 million earnings by 2028. This requires 4.8% yearly revenue growth and a $280.8 million earnings increase from $12.5 million today.

Uncover how AAR's forecasts yield a $92.25 fair value, a 3% upside to its current price.

Exploring Other Perspectives

Three fair value estimates from the Simply Wall St Community span roughly US$76.69 to US$178.99, underlining how far apart individual views can be. Against that backdrop, AAR’s recent earnings rebound and traction in digital MRO platforms invite you to weigh both the upside from execution and the ongoing risk that its software investments may not scale as planned.

Explore 3 other fair value estimates on AAR - why the stock might be worth over 2x more than the current price!

Build Your Own AAR Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your AAR research is our analysis highlighting 2 key rewards and 3 important warning signs that could impact your investment decision.
• Our free AAR research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate AAR's overall financial health at a glance.

Curious About Other Options?

Our daily scans reveal stocks with breakout potential. Don't miss this chance:

• These 14 companies survived and thrived after COVID and have the right ingredients to survive Trump's tariffs. Discover why before your portfolio feels the trade war pinch.
• We've found 13 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free.
• AI is about to change healthcare. These 29 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10b in market cap - there's still time to get in early.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com