Delta Air Lines Prepares for Earnings Announcement Amid Market Challenges
With a market cap of $27.4 billion, Delta Air Lines, Inc. (DAL) stands as one of the largest global airlines, recognized for its vast domestic and international network. Based in Atlanta, Georgia, Delta employs a hub-and-spoke system to connect passengers across key cities and regions around the world.
Offering various services from economy to premium cabins, Delta prioritizes customer experience, operational efficiency, and strong loyalty programs, particularly its SkyMiles rewards system. The company is set to announce its fiscal Q1 earnings on Wednesday, April 9.
Analysts Anticipate Earnings Dip
Ahead of this earnings report, analysts predict that DAL will report a profit of $0.42 per share, reflecting a decline of 6.7% from the $0.45 per share reported in the same quarter last year. Over the last four reporting periods, the company has performed well, exceeding Wall Street’s profit expectations twice, while falling short in two instances.
In its most recent quarter, Delta reported an EPS of $1.85, surpassing the consensus estimate by 5.1%, thanks to strong demand during the holiday travel period.
Future Earnings Expectations
Looking ahead to fiscal 2025, analysts expect Delta Air Lines to report an EPS of $7.08, a 14.9% increase from the $6.16 EPS in fiscal 2024. Projections for fiscal year 2026 suggest a further rise, with EPS anticipated to reach $8.20, representing a 15.8% annual growth rate.
Over the past year, DAL shares have declined by 7.5%, lagging behind the S&P 500 Index’s 8.9% gain and the 6.9% return of the S&P 500 Industrial Sector SPDR (XLI) during the same period.
Market Reaction and Analyst Consensus
Despite its strong market position, Delta’s shares fell over 4% on April 1 after Jefferies Financial Group Inc. (JEF) downgraded the stock from “Buy” to “Hold.” This change reflects the mounting challenges facing the airline industry, which include increasing fuel prices, higher labor costs, and a potential softening in travel demand.
Nonetheless, the overall consensus rating for Delta Air Lines stock remains optimistic, classified as a “Strong Buy.” Out of the 21 analysts covering the stock, 20 support a “Strong Buy,” while one suggests a “Hold.”
The average analyst price target for DAL stands at $76.29, signaling a substantial potential upside of 75.9% compared to current price levels.
On the date of publication, Kritika Sarmah did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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