In the latest close session, Delta Air Lines (DAL) was up +2.04% at $75.63. The stock’s performance was ahead of the S&P 500’s daily gain of 0.17%. Meanwhile, the Dow gained 0.55%, and the Nasdaq, a tech-heavy index, added 0.09%.
Shares of the airline have appreciated by 8.35% over the course of the past month, outperforming the Transportation sector’s loss of 0.9%, and the S&P 500’s gain of 4.59%.
The investment community will be paying close attention to the earnings performance of Delta Air Lines in its upcoming release. The company’s earnings per share (EPS) are projected to be $1.49, reflecting a 29.05% decrease from the same quarter last year. Meanwhile, the latest consensus estimate predicts the revenue to be $17.42 billion, indicating a 4.65% increase compared to the same quarter of the previous year.
For the full year, the Zacks Consensus Estimates project earnings of $5.26 per share and a revenue of $65.37 billion, demonstrating changes of -9.62% and +3.17%, respectively, from the preceding year.
It is also important to note the recent changes to analyst estimates for Delta Air Lines. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, upbeat changes in estimates indicate analysts’ favorable outlook on the business health and profitability.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To exploit this, we’ve formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.69% lower. Currently, Delta Air Lines is carrying a Zacks Rank of #3 (Hold).
In terms of valuation, Delta Air Lines is currently trading at a Forward P/E ratio of 14.09. This signifies a premium in comparison to the average Forward P/E of 10.77 for its industry.
It’s also important to note that DAL currently trades at a PEG ratio of 1.07. 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 industry had an average PEG ratio of 0.94 as trading concluded yesterday.
The Transportation – Airline industry is part of the Transportation sector. At present, this industry carries a Zacks Industry Rank of 203, placing it within the bottom 17% of over 250 industries.
