Does FTAI Aviation Still Offer Upside After 20% Rally in 2025?

Ever find yourself staring at FTAI Aviation’s soaring stock chart and wondering if the rally still has legs, or whether you’ve missed the boat? If you’re weighing the idea of making a move or sitting tight, you’re not alone. This name has caught a lot of attention lately, and not just because of headline-grabbing returns. Just look at the numbers: the stock added 2.2% over the past week, is up 1.0% in the last month, and has jumped an eye-popping 20.6% so far this year. Take a step back even further, and it’s even more impressive. Over the past three and five years, FTAI Aviation has gained more than 1,100% and 1,400%, respectively. Those kinds of moves get people talking about growth, but also raise questions around risk, sustainability, and, of course, value.

The recent price momentum might be fueled by ongoing shifts in the aviation and leasing markets, which have made asset-backed strategies like FTAI’s increasingly attractive. Any time a stock racks up gains like this, investors start to wonder if it’s running ahead of itself. According to a composite valuation score, which serves as a quick check on whether the market might be underestimating or overestimating the company’s potential, FTAI Aviation comes in at a solid 3 out of 6. In other words, the company shows signs of being undervalued in half of the criteria most investors care about.

So how do those valuation methods work, and which one might actually help you make the smartest move? Let’s break down the main approaches investors use, while saving a surprising take on what really matters for valuation for the end.

FTAI Aviation delivered 20.6% returns over the last year. See how this stacks up to the rest of the Trade Distributors industry.

Approach 1: FTAI Aviation Discounted Cash Flow (DCF) Analysis

The Discounted Cash Flow (DCF) model works by projecting a company’s future free cash flows and then discounting those back to today’s dollar value, giving an estimate of what the whole business might be worth right now. This method aims to capture both the timing and size of future cash a business can generate, which can be especially important in asset-heavy industries like aviation.

For FTAI Aviation, the current Free Cash Flow (FCF) stands at $-604 million, indicating the business is still in a heavy investment or ramp-up phase. Looking forward, analysts project the company could generate FCF of up to $1.2 billion by 2028. These initial analyst estimates stretch out to 2028, after which Simply Wall St extrapolates further growth. Over a ten-year period, DCF projections show FCF ramping up steadily year after year, providing a rare look at the potential scale of future profitability for FTAI Aviation.

All these projected cash flows, when discounted back to present-day dollars, suggest an intrinsic fair value of $411.09 per share. Right now, the DCF model implies the stock is trading at a remarkable 57.6% discount. This suggests it may be significantly undervalued relative to the underlying business fundamentals.

Result: UNDERVALUED

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for FTAI Aviation.

Our Discounted Cash Flow (DCF) analysis suggests FTAI Aviation is undervalued by 57.6%. Track this in your watchlist or portfolio, or discover more undervalued stocks.

Approach 2: FTAI Aviation Price vs Earnings (P/E)

For profitable companies like FTAI Aviation, the price-to-earnings (P/E) ratio is a popular way to gauge whether shares are attractively valued. The P/E ratio highlights how much investors are willing to pay today for a dollar of current earnings, giving a quick read on both sentiment and expectations for future growth.

In general, a higher P/E ratio signals the market anticipates stronger earnings growth or views the company as having lower risk compared to peers. However, it is important to remember that the “right” P/E depends not only on industry norms, but also on a company’s own earnings growth prospects, profit margins and risk profile in the market landscape.

FTAI Aviation currently trades at 42.9x earnings, which puts it well above both the industry average (22.1x) and the average for its closest peers (18.0x). This might seem expensive at first glance. Simply Wall St, however, has developed a proprietary “Fair Ratio” to provide fuller context. This Fair Ratio weighs factors like company growth, profitability, industry trends, market cap and risks, providing a more tailored benchmark than simply stacking up against other companies, many of which may have very different profiles.

For FTAI Aviation, the Fair Ratio comes in at 68.8x. Comparing this to the current P/E of 42.9x suggests that the stock is actually trading below what would be expected for a company with its specific profile and growth outlook. So, even though the P/E is elevated compared to the industry, when you factor in FTAI Aviation’s fundamentals, it may be undervalued by this metric.

Result: UNDERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your FTAI Aviation Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let's introduce you to Narratives. Narratives are a simple yet powerful tool that lets you define the story behind your numbers, bringing your assumptions about FTAI Aviation’s future revenue, earnings, and profit margins to life in a clear, accessible forecast alongside an estimated fair value.

On Simply Wall St’s Community page, Narratives allow you and millions of other investors to connect the company’s journey with objective financial models. This shows exactly where your conviction comes from. Instead of just looking at analyst targets or historical ratios, you can anchor your decisions in your own perspective, whether you see FTAI Aviation as a long-term growth engine or a riskier cyclical bet.

Narratives help you decide when to buy or sell by making it easy to compare your Fair Value against the current Price, and they update automatically when news or earnings are released. For example, one investor may confidently forecast aggressive earnings expansion and reach a fair value of $300 per share, while another, with a more cautious outlook, sets a fair value as low as $150. This highlights how your personal view shapes smarter investing decisions.

Do you think there's more to the story for FTAI Aviation? Create your own Narrative to let the Community know!

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.

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