Middle Coast Investing’s Added Air Lease (AL) After a Buy-Out Agreement. Here’s Why

Middle Coast Investing, an investment advisor firm, released its third-quarter 2025 investor letter. A copy of the letter can be downloaded here. The third quarter was favorable for Middle Coast Investing. Its collective portfolio outperformed the S&P 500 and is ahead of benchmarks year to date. In Q3 2025, the US Portfolios returned 9.6% compared to 7.8% for the S&P 500. It’s Core U.S. portfolios returned 10% while the Russell 2000 returned 12%, the S&P 600 returned 8.7% and the Nasdaq generated 11.2% for the same period. Also, its European Portfolios appreciated by 5.5%. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its third-quarter 2025 investor letter, Middle Coast Investing highlighted stocks such as Air Lease Corporation (NYSE:AL). Air Lease Corporation (NYSE:AL) is an aircraft leasing company. The one-month return of Air Lease Corporation (NYSE:AL) was 0.14%, and its shares gained 48.29% of their value over the last 52 weeks. On October 6, 2025, Air Lease Corporation (NYSE:AL) stock closed at $63.69 per share, with a market capitalization of $7.118 billion.

Middle Coast Investing stated the following regarding Air Lease Corporation (NYSE:AL) in its third quarter 2025 investor letter:

“Air Lease Corporation (NYSE:AL) is a smaller competitor to AerCap, which we’ve owned for a long time. It has agreed to a buyout. We bought shares after the deal was announced, so no big spike. Instead, we bought for two scenarios. Scenario 1 is nothing dramatic happens, we earn 3.2% in tax-advantaged accounts over the next 6-9 months, more or less equivalent to a treasury bill. Scenario 2 is that another buyer comes in and bids more for the company, as the agreed-to takeout price is a steal (a cheaper valuation than AerCap’s, for example). I don’t think scenario 2 is that likely, but it’s enough that I feel it worth buying a small position. Scenario 3 would be the deal falling apart, but Air Lease stock would still be cheap, and there’s no specific reason (i.e. anti-trust, f inancing) that would get in the way of the deal closing.”

Air Lease Corporation (NYSE:AL) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 44 hedge fund portfolios held Air Lease Corporation (NYSE:AL) at the end of the second quarter, up from 37 in the previous quarter. In the second quarter of 2025, Air Lease reported revenues of $732 million and $3.33 in diluted earnings per share. While we acknowledge the risk and potential of Air Lease Corporation (NYSE:AL) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than Air Lease Corporation (NYSE:AL) and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In another article, we covered Air Lease Corporation (NYSE:AL) and shared the list of stocks outperformed Wall Street’s main indices. In addition, please check out our hedge fund investor letters Q3 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.