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Delta Air Lines (DAL) Gains But Lags Market: What You Should Know

Zacks Equity Research
Weatherford (WFTIQ) doesn't possess the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.

Delta Air Lines (DAL) closed the most recent trading day at $55.07, moving +0.69% from the previous trading session. This move lagged the S&P 500's daily gain of 1.05%. At the same time, the Dow added 1.02%, and the tech-heavy Nasdaq gained 1.66%.

Prior to today's trading, shares of the airline had lost 3.36% over the past month. This has was narrower than the Transportation sector's loss of 5.27% and lagged the S&P 500's loss of 2.76% in that time.

Wall Street will be looking for positivity from DAL as it approaches its next earnings report date. On that day, DAL is projected to report earnings of $2.16 per share, which would represent year-over-year growth of 22.03%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $12.36 billion, up 4.93% from the year-ago period.

DAL's full-year Zacks Consensus Estimates are calling for earnings of $6.70 per share and revenue of $46.53 billion. These results would represent year-over-year changes of +18.58% and +4.72%, respectively.

Investors might also notice recent changes to analyst estimates for DAL. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.1% higher within the past month. DAL is currently sporting a Zacks Rank of #3 (Hold).

In terms of valuation, DAL is currently trading at a Forward P/E ratio of 8.16. This valuation marks a discount compared to its industry's average Forward P/E of 9.79.

We can also see that DAL currently has a PEG ratio of 0.59. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Transportation - Airline was holding an average PEG ratio of 0.61 at yesterday's closing price.

The Transportation - Airline industry is part of the Transportation sector. This group has a Zacks Industry Rank of 193, putting it in the bottom 25% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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