Wells Fargo On AerCap: Another 'Buy-On-Weakness' Opportunity

In a report published Tuesday, Wells Fargo analyst Liebowitz maintained an Outperform rating on

, while raising the valuation range from $54-$56 to $57-$60. AerCap reported its Q1 adjusted EPS at $1.42, ahead of the estimate. The EPS came in at $1.40. The upside was driven by trading gains, net maintenance and SG&A. In the report Wells Fargo noted, "Other than the addition of Q1's $34M ($0.14 EPS) trading gain, AerCap's 2015 guidance did not change and implies EPS of about $5.15. We are comfortable with a higher estimate, as guidance assumes no additional trading gains or accretive cash deployment - both highly conservative assumptions, in our view." AerCap's shares declined after the company reported strong 1Q results. Liebowitz wrote that the share price may have come under pressure due to the absence of share repurchases during the quarter or the company "not providing more clarity" on the exit of

, which has a 46 percent ownership stake. The EPS estimates for 2015 and 2016 have been raised from $5.30 to $5.45 and from $5.70 to $5.80, respectively. The analysts believe that there may is "further upside potential from trading gains."