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Delta Air Lines (DAL) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research

Delta Air Lines (DAL) closed at $53.81 in the latest trading session, marking a +1.86% move from the prior day. This change outpaced the S&P 500's 1.42% gain on the day. At the same time, the Dow added 1.42%, and the tech-heavy Nasdaq gained 1.4%.

Coming into today, shares of the airline had lost 9.21% in the past month. In that same time, the Transportation sector lost 0.7%, while the S&P 500 gained 0.38%.

DAL will be looking to display strength as it nears its next earnings release, which is expected to be October 10, 2019. On that day, DAL is projected to report earnings of $2.27 per share, which would represent year-over-year growth of 26.11%. Meanwhile, our latest consensus estimate is calling for revenue of $12.59 billion, up 5.31% from the prior-year quarter.

DAL's full-year Zacks Consensus Estimates are calling for earnings of $7.07 per share and revenue of $46.86 billion. These results would represent year-over-year changes of +25.13% and +5.46%, respectively.

Investors should also note any recent changes to analyst estimates for DAL. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 0.37% lower. DAL is currently a Zacks Rank #3 (Hold).

Looking at its valuation, DAL is holding a Forward P/E ratio of 7.47. This represents a discount compared to its industry's average Forward P/E of 8.92.

Investors should also note that DAL has a PEG ratio of 0.47 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Transportation - Airline was holding an average PEG ratio of 0.48 at yesterday's closing price.

The Transportation - Airline industry is part of the Transportation sector. This group has a Zacks Industry Rank of 201, putting it in the bottom 22% 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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