GR Goodrich Corp. (The)

AAR CORP. (AIR) recently announced amendment of its senior, unsecured credit agreement, increasing the initial limit under the revolving credit facility from $400 million to $580 million. The agreement has the option to increase the limit further to $680 million under certain circumstances. Under the agreement, all pricing terms will remain unchanged, while certain covenants under the facility are modified to provide the company greater flexibility.

The amended agreement is anticipated to boost investor confidence and further capitalize on growth opportunities with significant financial flexibility over the remaining four-and-a-half year term of the agreement.

The board of directors of the company recently declared a quarterly cash dividend of $0.075 per share to its stockholders. The dividend will be paid on November 4, 2011 to stockholders of record as of the close of business on October 24, 2011.

Of late, the aviation industry as a whole has started showing signs of improvements. This is expected to bring in a positive trend in the commercial air transport market, thereby creating a robust demand for maintenance and spare parts, equipment and methods of repair and overhaul services.

In such a demand surging environment, the company’s market expertise, technical and financial capabilities as well as its commitment toward returning shareholder values are expected to help AAR maintain a satisfactory position in the industry.

Based in Wood Dale, Illinois, AAR Corp. provides various products and services to the aviation and defense industries worldwide. The company operates in four segments: Aviation Supply Chain; Maintenance, Repair, and Overhaul; Structures and Systems; and Government & Defense Services. The company competes directly with its peers, such as Goodrich Corp (GR), Boeing Co (BA), and Lockheed Martin Corporation (LMT).

We currently maintain a long-term Neutral recommendation on the stock. AAR CORP. has a Zacks #3 Rank, which translates into a short-term Hold rating (1-3 months).

 
AAR CORP (AIR): Free Stock Analysis Report
 
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