In This Article:
What Happened?
Shares of aircraft leasing company FTAI Aviation (NASDAQ:FTAI) jumped 8% in the morning session as the stock continued to recover after the Muddy Waters short report accusing the company of misrepresenting its business (more asset sales than maintenance, repair, overhaul (MRO) revenue) and engaging in misleading depreciation tactics. This could show that as investors digest the news and speak to FTAI management/investor relations, they are gaining more confidence in the business compared to when the report was initially published. Additionally, multiple sellside analysts from firms such as Morgan Stanley, Jefferies, and BTIG have defended the stock and categorized the drop post-Muddy Waters report to be overblown.
The shares closed the day at $101.54, up 10.4% from previous close.
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What The Market Is Telling Us
FTAI Aviation’s shares are very volatile and have had 27 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was about 23 hours ago when the stock gained 8.4% on the news that BTIG analyst Andre Madrid showed strong confidence in the business quality and the stock, saying "Despite the market reaction, we remain positive on the company's disruptive aftermarket approach and ability to drive further profitability at the Aerospace Products business."
Madrid has a Buy rating with a $190 price target, indicating that he believes shares can more than double in the coming year. Thus far, multiple sell-side firms such as Morgan Stanley have defended the company following the Muddy Waters short report.
FTAI Aviation is down 30.3% since the beginning of the year, and at $100.61 per share, it is trading 42.5% below its 52-week high of $174.96 from November 2024. Investors who bought $1,000 worth of FTAI Aviation’s shares 5 years ago would now be looking at an investment worth $5,028.
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