Here's Why Investors Should Avoid Air Lease Stock for Now

Air Lease AL is mired in significant challenges stemming from increased expenses and weak liquidity. Geopolitical uncertainty is also hurting the company’s prospects, making it an unattractive choice for investors’ portfolios.

Let’s delve deeper.

AL: Key Risks to Watch

Southward Earnings Estimate Revision: The Zacks Consensus Estimate for the first quarter of 2026 has been revised 0.6% downward in the past 60 days. Meanwhile, for 2026, the consensus mark for earnings has been revised 0.14% downward respectively at the same time.

The unfavorable estimate revision indicates brokers’ lack of confidence in the stock.

Dim Price Performance: Air Lease’s price trend reveals that its shares, though, have risen 0.8% over the past 90-day period, failed to outperform the Transportation - Equipment and Leasing industry’s 4.2% growth.

Weak Zacks Rank: AL currently has a Zacks Rank #5 (Strong Sell).

Bearish Industry Rank: The industry to which Air Lease belongs currently has a Zacks Industry Rank of 209 (out of 243). Such an unfavorable rank places it in the bottom 14% of Zacks Industries. Studies show that 50% of a stock’s price movement is directly related to the performance of the industry group it belongs to.

A mediocre stock within a strong group is likely to outperform a robust stock in a weak industry. Reckoning the industry’s performance becomes imperative in this context.

Headwinds: AL faces mounting challenges that continue to weigh on its outlook. Rising costs and weak liquidity are pressuring profitability, with total operating expenses jumping 7.3% year over year in the third quarter of 2025. Selling, general and administrative expenses rose 14.2% year over year, while stock-based compensation expenses climbed 21.3% to $9.6 million, further straining margins.

Liquidity remains a major concern for AL, as its current ratio (a measure of liquidity) has stayed weak and highly volatile over the period. The ratio fell sharply from 1.12 in 2022 to 0.40 in 2023 and remained depressed at 0.37 in 2024, with only a slight improvement to 0.43 in the third quarter of 2025. This persistently low level underscores continued strain on the company’s ability to meet its short-term obligations.

Moreover, AL operates in a challenging macroeconomic environment. Economic uncertainty, evolving tariff policies and heightened geopolitical tensions are increasing operational and compliance risks. These conditions are prompting companies to delay investments, reassess forecasts and remain highly agile, adding another layer of uncertainty to AL’s near-term prospects.

Stocks to Consider

Investors interested in the Zacks Transportation sector should consider Expeditors International of Washington EXPD and Global Ship Lease GSL.

EXPD currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

EXPD has an expected earnings growth rate of 3.50% for the current year.  The company has an encouraging earnings surprise history. Its earnings outpaced the Zacks Consensus Estimate in the trailing four quarters, delivering an average beat of 13.9%.

Global Ship Lease currently carries a Zacks Rank #2 (Buy).

GSL has an expected earnings growth rate of 2.60% for the current year. The company has an encouraging earnings surprise history. Its earnings topped the Zacks Consensus Estimate in the trailing four quarters, delivering an average beat of 16.8%.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research