Should You Invest in FTAI Aviation (FTAI)?

Aristotle Capital Boston, LLC, an investment advisor, released its “Small/Mid Cap Equity Strategy” second quarter 2025 investor letter. A copy of the letter can be downloaded here. The second quarter started with a risk-off environment from the previous quarter, but later regained momentum driven by broad-based elements. In the second quarter, the strategy delivered a return of 4.64% net of fees (4.78% gross of fees), underperforming the 8.59% total return of the Russell 2500 Index. For more information on the fund’s best picks in 2025, please check its top five holdings.

In its second-quarter 2025 investor letter, Aristotle Capital Small/Mid Cap Equity Strategy highlighted stocks such as FTAI Aviation Ltd. (NASDAQ:FTAI). FTAI Aviation Ltd. (NASDAQ:FTAI) owns and acquires aviation equipment for the transportation of goods and people. The one-month return of FTAI Aviation Ltd. (NASDAQ:FTAI) was 19.71%, and its shares gained 34.96% of their value over the last 52 weeks.  On July 31, 2025, FTAI Aviation Ltd. (NASDAQ:FTAI) stock closed at $137.61 per share, with a market capitalization of $14.113 billion.

Aristotle Capital Small/Mid Cap Equity Strategy stated the following regarding FTAI Aviation Ltd. (NASDAQ:FTAI) in its second quarter 2025 investor letter:

"FTAI Aviation Ltd. (NASDAQ:FTAI), owns and leases aircraft engines, and operates a maintenance, repair and exchange (MRE) business that provides parts and services for older jet engines. Growing global demand for air travel combined with an aging fleet of aircraft and engines are driving demand for replacement engines and third-party maintenance and repair services. The company recently embarked on a strategy of partnering with private equity firms to provide capital to grow the leasing business. The business model evolution should result in a less capital-intensive leasing business for FTAI and may provide a captive source of demand for the MRE business, enhancing margins and shareholder value."

FTAI Aviation Ltd. (NASDAQ:FTAI) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 49 hedge fund portfolios held FTAI Aviation Ltd. (NASDAQ:FTAI) at the end of the first quarter, which was 54 in the previous quarter. While we acknowledge the potential of FTAI Aviation Ltd. (NASDAQ:FTAI) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered FTAI Aviation Ltd. (NASDAQ:FTAI) and shared Frontier Small Cap Growth Fund's views on the company in the previous quarter. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.