L1 Capital, an investment management firm, released its "L1 Capital International Fund" (unhedged) second-quarter 2026 investor letter. A copy of the letter can be downloaded here. The letter discusses the current investment environment as a 'two-speed' but resilient global economy, accompanied by an uncertain future. The letter explores the potential of an AI bubble, distinguishing between strong fundamentals and speculative momentum. Additionally, the market displays a 'narrow' character, marked by high exuberance and pronounced over-pessimism. Against this backdrop, the Fund returned +2.6% (net of fees) during the June 2026 quarter, compared to the benchmark return of +12.5% (all in A$). The underperformance was driven more by which investments were not held in the Fund. The Fund remains focused on quality, valuation and the avoidance of permanent capital loss, and believes the portfolio is positioned to deliver attractive risk-adjusted returns for patient investors. In addition, you can check the Fund's top five holdings to know its best picks in 2026.
In its Q2 2026 investor letter, L1 Capital International Fund highlighted AerCap Holdings N.V. (NYSE:AER). AerCap Holdings N.V. (NYSE:AER) is a leading aviation leasing company headquartered in Dublin, Ireland. On July 17, 2026, AerCap Holdings N.V. (NYSE:AER) closed at $146.97 per share, reflecting a market capitalization of $23.18 billion. AerCap Holdings N.V. (NYSE:AER) posted a one-month return of 0.08%, while its shares gained 33.08% over the past 52 weeks.
L1 Capital International Fund stated the following regarding AerCap Holdings N.V. (NYSE:AER) in its Q2 2026 investor update:
"AerCap Holdings N.V. (NYSE:AER), the world's largest aircraft and aircraft engine lessor, continues to benefit from strong demand and constrained supply across both aircraft and engines. Higher fuel prices associated with the Middle East conflict have contributed to some adjustment in airline capacity and increased pressure on weaker carriers, but we do not expect this to materially negatively impact AerCap and may present opportunities for AerCap's nimble management team. We expect another quarter of strong financial results and elevated buyback activity. Although upside is more modest following recent share price appreciation, AerCap remains a high-quality compounder capable of creating significant shareholder value through sustained financial performance and disciplined capital allocation."
AerCap Holdings N.V. (NYSE:AER) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 56 hedge fund portfolios held AerCap Holdings N.V. (NYSE:AER) at the end of the first quarter, up from 54 in the previous quarter. While we acknowledge the potential of AerCap Holdings N.V. (NYSE:AER) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
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