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With a market cap of nearly $41.3 billion, Georgia-based Delta Air Lines, Inc. (DAL) is redefining travel with exceptional service and cutting-edge innovation, striving to make every journey uniquely tailored to its customers. Powered by a 100,000-strong team, Delta connects people and places across six continents with over 4,000 daily flights to 290+ destinations. Committed to a future of connected, personalized, and enjoyable travel, Delta's mission is to ensure every passenger feels welcomed and cared for at every touchpoint.
Shares of this airline company have soared almost 79.2% over the past year and 59.3% on a YTD basis, easily blowing past the broader S&P 500 Index’s ($SPX) 30.4% annual return and 23.1% YTD growth.
Zooming in further, the stock appears to have also outshined the Industrial Select Sector SPDR Fund’s (XLI) 32.6% return over the past 52 weeks and a 22% gain on a YTD basis.
The company reported its Q3 earnings results on Oct. 10, which revealed a mixed bag of performance. While its topline figure of $15.7 billion blew past Wall Street’s estimates, its adjusted EPS of $1.50 fell short of Street forecasts. Yet, despite delivering such mixed results, the market responded positively, and shares of Delta jumped almost 2.1% on Oct. 11 as the company demonstrated its financial muscle.
During the quarter, Delta’s robust cash generation has enabled $2.4 billion in debt repayment so far this year, reducing its gross leverage to below three times. The airline also hit a high-flying milestone as Fitch upgraded its balance sheet to investment grade, underscoring its solid financial footing.
For the current fiscal year, ending in December, analysts expect DAL’s EPS to decline 2.9% to $6.07. The company’s earnings surprise history is mixed. It beat the consensus estimate in two of the last four quarters while missing on two other occasions.
Nevertheless, overall, Wall Street appears to be bullish on DAL stock, with a unanimous “Strong Buy” rating from all the 20 analysts in coverage.
In fact, the mood on Wall Street is slightly more bullish compared to a month ago when 19 analysts suggested a “Strong Buy.”
On Nov. 15, Evercore ISI adjusted its price target from $65 to $80, maintaining an “Outperform” rating on DAL stock.
The mean price target of $66.39 indicates a slight potential upside from the current price levels, while the Street-high price target of $85 suggests that DAL could rally as much as 32.7% from here.
