StandardAero shares rise 9.1% after raised 2026 profit forecast

StandardAero (SARO) raised its full-year 2026 profit forecast after third-quarter adjusted earnings per share of 39 cents topped the 38 cents consensus estimate. Revenue of $1.56 billion missed the $1.59 billion estimate.

Shares rose 9.1% at 3:59 p.m. ET, from a $25.30 close.

The company said engine services drove the quarter. Adjusted EBITDA rose 15.0% to $224.9 million from $195.6 million a year earlier.

Here's how the company did:

• Revenue: $1.56 billion vs. $1.50 billion a year earlier, $1.59 billion expected
• Adjusted EPS: 39 cents per share vs. 30 cents a year earlier, 38 cents expected
• Net income: $92.8 million vs. $68.1 million a year earlier
• Adjusted EBITDA: $224.9 million vs. $195.6 million a year earlier
• Adjusted free cash flow: $99.2 million

Net income has risen in each of the last three quarters, from $68.1 million in the third quarter of 2025 to $97.3 million in the second quarter of 2026.

2026 guidance

The company now expects 2026 revenue of $6.53 billion to $6.65 billion, a range that includes the effect of eliminating about $300 million in pass-through material revenue.

Adjusted EBITDA is forecast at $905 million to $920 million, adjusted free cash flow at $270 million to $300 million and adjusted diluted EPS at $1.57 to $1.62 per share.

Adjusted diluted EPS now also excludes amortization of all intangible assets, including those tied to licenses. The change took effect in the second quarter, and management believes it gives a more useful baseline. Adjusted free cash flow excludes purchases of all intangible assets for the same reason.

Commercial aerospace revenue is expected to grow low double digits to mid-teens percent, military and helicopter low double digits, and business aviation high single digits to low double digits.

Segment results

Engine Services revenue rose 3.5% to $1.37 billion from $1.32 billion a year earlier. Its segment adjusted EBITDA climbed 24.0% to $205.1 million from $165.4 million.

Component Repair Services revenue rose 7.3% to $188.7 million from $175.8 million. Segment adjusted EBITDA fell 9.9% to $48.6 million from $54.0 million, driven primarily by productivity and mix.

Share repurchases

The Board on Oct. 28 approved a $560.0 million increase to the share repurchase program, bringing total authorization to $1.0 billion with $850.0 million remaining. The company has repurchased about $160.1 million of shares to date.

The company intends to enter into a $350.0 million accelerated share repurchase agreement with Morgan Stanley. Once it completes, about $500.0 million will remain under the program.

“With a healthy backlog, long-term visibility and continued progress in deleveraging, we intend to enter into a $350 million accelerated share repurchase and the Board has increased our share repurchase authorization to $1.0 billion,” said Chief Executive Officer Paul McElhinney.