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    Does xCelle Asia JV and New Distribution Deals Change The Bull Case For AAR (AIR)?

    Simply Wall St·12/13/2025 22:15:22
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    • In recent days, AAR CORP. completed the formation of xCelle Asia, a Thailand-based joint venture with Air France Industries KLM Engineering & Maintenance to overhaul next-generation aircraft nacelles for APAC operators, while also extending multi-year exclusive global distribution agreements with Collins Aerospace and Arkwin Industries.
    • Together, these moves deepen AAR’s role across high-value MRO and parts distribution niches, broadening its geographic reach and reinforcing long-term aftermarket support for newer aircraft platforms.
    • We’ll now examine how the xCelle Asia joint venture could reshape AAR’s investment narrative around MRO expansion and regional diversification.

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    AAR Investment Narrative Recap

    To own AAR, you generally need to believe in a resilient, growing aviation aftermarket where independent MRO and parts providers can hold their ground alongside OEMs. The xCelle Asia joint venture and renewed distribution deals strengthen AAR’s position in high-value niches, but they do not remove the short term risk that a downturn in commercial flying or airline cost-cutting could still hit Parts Supply revenue and margins.

    Among the latest announcements, the multi-year extension of AAR’s exclusive global distribution agreement with Collins Aerospace is especially relevant. It reinforces AAR’s role as a key channel partner across commercial, general aviation, and defense markets, which can support the same aftermarket expansion story that xCelle Asia is part of, even as competitive pressure from OEMs remains a central risk to monitor.

    Yet for investors, growing OEM aftermarket power means AAR’s ability to defend margins is something you should be aware of as...

    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 an earnings increase of about $280.8 million from $12.5 million today.

    Uncover how AAR's forecasts yield a $92.25 fair value, a 10% upside to its current price.

    Exploring Other Perspectives

    AIR 1-Year Stock Price Chart
    AIR 1-Year Stock Price Chart

    Three members of the Simply Wall St Community currently see AAR’s fair value between US$76.69 and about US$191.92, reflecting a wide spread of expectations. Set against that, the growing role of OEMs in the aftermarket raises important questions about how AAR’s margins and contract economics might evolve, which you may want to compare with these differing views.

    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.

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    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.