On Wednesday, BofA Securities expressed a positive outlook on Delta Air Lines (NYSE:DAL), raising the stock's price target from $50.00 to $53.00 while maintaining a Buy rating. The airline is set to initiate the earnings season for the sector next Wednesday, April 10, and is expected to provide guidance on the second quarter of 2024.
The analyst from BofA Securities anticipates strong top-line growth for Delta Air Lines, with a revenue growth estimate of +4.8% for the second quarter, surpassing the Visible Alpha consensus of +3.8%. This optimism is based on the forecast that Delta will deliver solid revenue performance in the upcoming quarter.
In addition to revenue, the analyst's projections for fuel and unit costs are also above the consensus, leading to an adjusted second-quarter earnings per share (EPS) estimate of $2.12, up from the previous $2.07. This figure, however, is below the consensus estimate of $2.30 EPS. The upward revision reflects the analyst's confidence in the airline's revenue-generating capabilities.
Looking further ahead, BofA Securities has increased its 2024 EPS estimate for Delta Air Lines to $6.57, up from the earlier prediction of $6.24, and slightly above the consensus of $6.45. This revision indicates an expectation for continued strong performance from the airline throughout the year.
The analyst reiterated a Buy rating for Delta Air Lines, signaling a belief in the stock's potential for growth. The raised price target to $53 from $50 is indicative of the firm's confidence in Delta's financial prospects and its ability to navigate the market in the upcoming quarter and beyond.
InvestingPro Insights
As Delta Air Lines (NYSE:DAL) gears up to kick off the earnings season for the airline industry, recent data from InvestingPro shows that the company is trading at a low earnings multiple, with a P/E Ratio (Adjusted) of 6.9 as of the last twelve months ending Q4 2023. This could indicate that the stock is potentially undervalued relative to its earnings, which aligns with BofA Securities' positive stance and price target increase.
The company's robust performance is further highlighted by a strong return over the last three months, with a 19.08% price total return, and an even more impressive six-month price total return of 29.82%. These figures underscore the company's momentum leading up to the earnings report. Additionally, Delta's status as a prominent player in the Passenger Airlines industry is reflected in its significant market capitalization of $29.77B USD.
For investors looking for more in-depth analysis, there are additional InvestingPro Tips available that may provide further insight into Delta's financial health and market position. These include observations on shareholder yield and the company's profitability over the last twelve months. With the next earnings date on the horizon, these tips could offer valuable information for making informed decisions. To explore these tips and more, consider using the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription at InvestingPro. In total, there are 9 additional InvestingPro Tips for Delta Air Lines, which could be instrumental in crafting a comprehensive investment strategy.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.