Citi arrives at its $45/share target price for Air Lease, by applying a 9.5x multiple to 2026E EPS.  This multiple is in-line with the stock's historical, pre-pandemic average.  This level considers aircraft lessors' growing, long-term market share gains vs. OEMs, balanced against tariff uncertainties.

Key risks to our target price include: (A) softer global economic conditions, resulting in higher default rates from lessees; (B) residual values on its owned aircraft fall sharply, which could impact lease rates; and (C) higher/lower global interest rates, which could impact the company's servicing of floating rate debt, against lease rates that remain fixed.

Positive or adverse developments in these risk factors could cause the share price to remain above or fall below our target price.