Why Is AAR (AIR) Down 0.4% Since Last Earnings Report?

Core Insights - AAR Corp. reported strong first-quarter fiscal 2026 earnings, with adjusted earnings of $1.08 per share, exceeding estimates by 10.2% and improving 27.1% year-over-year [2][3] - The company's net sales reached $739.6 million, surpassing estimates by 7.9% and reflecting an 11.8% increase from the previous year [4] - Despite positive earnings and sales growth, there has been a downward trend in estimates since the earnings release, indicating potential concerns among investors [8][10] Financial Performance - AAR's adjusted operating margin improved from 9.1% to 9.7%, attributed to higher volume and profitability in new parts distribution [6] - Selling, general and administrative expenses decreased to $71.2 million from $75.9 million year-over-year [6] - The company reported a cash position of $80 million as of August 31, 2025, down from $96.5 million, and long-term debt increased to $1.02 billion [7] Segment Performance - The Parts Supply segment saw sales of $317.8 million, a 27.3% increase year-over-year [5] - Repair & engineering sales decreased by 1.4% to $214.6 million, while Integrated solutions sales rose by 9.5% to $185 million [5] - Expeditionary Services experienced a decline in sales by 12.9% to $22.2 million [5] Market Sentiment - AAR has a poor Growth Score of F, but a better Momentum Score of C, indicating mixed investor sentiment [9] - The overall VGM Score for AAR is D, suggesting a middle-ground position for value investors [9] - The stock holds a Zacks Rank 3 (Hold), with expectations for an in-line return in the coming months [10]