AerCap delivered a clean Q2 2026 print on July 29, 2026 that, on the surface, looks weaker than a year ago but is meaningfully stronger on a per-share, ex-one-off basis. GAAP net income of $726 million, or $4.59 per diluted share, came in well below the $1,259 million, or $7.09 per share, posted in the year-ago quarter, but that 2025 quarter was inflated by a $973 million one-time Ukraine-conflict recovery booked in Q2 2025. Strip out the 2025 recovery, and the 2026 quarter's operating earnings are the highest in company history on a normalized basis, with adjusted net income of $811 million and adjusted EPS of $5.14. Total revenue and other income rose 15% to $2.17 billion, the company sold 38 aircraft for $1.4 billion at a 20% unlevered gain margin (1.7x book on an equity basis), and operating cash flow reached $1.5 billion for the quarter.
Our read is that the market is pricing AerCap like a lender whose earnings are stuck, when the print shows a portfolio manager whose earnings power is rising and whose buyback yield is now the binding constraint on per-share growth. The 8.9x forward adjusted P/E on the new $16.80 guide, the 1.25x P/B against book value that grew 16% year over year, and the 7.4-year average fleet age sit alongside a $691 million Q2 buyback that retired 4.9 million shares, taking year-to-date repurchases above $1.4 billion. We see the buyback yield at roughly 6% of beginning-of-year market cap and the dividend yield near 1.1%, giving total capital return around 7% on a market cap that is well below replacement cost of a portfolio of this scale.
The single load-bearing risk is leverage concentration. Adjusted debt to equity at 2.05x and $42.8 billion of debt against $18.4 billion of equity mean a 200-basis-point move in borrowing costs reshapes roughly $850 million of pre-tax interest expense, which is more than the Q2 reported net income. The falsifiable clock is the Q3 print, expected in late October 2026, the moment that tests whether the new $16.80 full-year guide was conservative on the underlying portfolio margin (8.0% annualized net spread in Q2, up from 7.5%) or whether the second-half underwriting assumes asset-sale gains that have not been realized.