Delta Air Lines (DAL) AI Stock Analysis

• Market Cap: $33.42B
• Dividend Yield: 1.08%
• Average Volume (3M): 13.01M
• Price to Earnings (P/E): 9.0
• Beta (1Y): 1.25
• Revenue Growth: 4.91%
• EPS Growth: -27.21%
• Country: US
• Employees: 100,000
• Sector: Industrials
• Sector Strength: 91
• Industry: Airlines, Airports & Air Services
• EPS (TTM): 0.46
• Shares Outstanding: 652,953,060
• 10 Day Avg. Volume: 13,077,815
• 30 Day Avg. Volume: 13,007,403
• PEG Ratio: 8.98
• Price to Book (P/B): 1.89
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 10.47
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $62.13
• Price Target Upside: 21.37% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 16

Delta Air Lines exhibits strong financial performance with robust revenue growth and profitability. Technical indicators suggest short-term strength but caution in the longer term. The company's valuation metrics are attractive, and while the earnings call highlights resilience in certain segments, macroeconomic challenges persist. Overall, Delta is positioned well within the industry, but external factors pose risks.

Positive Factors

Brand Strength

Delta is the most trusted US airline brand with a global network and strong foothold in the premium segment.

Customer Satisfaction

Delta consistently ranks ahead of its domestic network peers in customer satisfaction/engagement surveys by focusing on offering differentiated products and delivering best-in-class service.

Financial Stability

Delta's strong balance sheet, with gross leverage at 2.6x and over $30bn in unencumbered assets, provides financial stability.

Negative Factors

Demand Concerns

Demand concerns cloud prospects amid heightened macro uncertainty and weaker sentiment.

Macroeconomic Uncertainty

Uncertainty in corporate and consumer sentiment, along with potential for further earnings downgrades, underpin a neutral stance.

Pricing Pressure

Pricing is expected to remain pressured with yields down over 5% for the remainder of the year, impacting Delta's financial performance.

Delta Air Lines Business Overview & Revenue Model

Company Description

Delta Air Lines, Inc. provides scheduled air transportation for passengers and cargo in the United States and internationally. The company operates through two segments, Airline and Refinery. Its domestic network centered on core hubs in Atlanta, Minneapolis-St. Paul, Detroit, and Salt Lake City, as well as coastal hub positions in Boston, Los Angeles, New York-LaGuardia, New York-JFK, and Seattle; and international network centered on hubs and market presence in Amsterdam, Mexico City, London-Heathrow, Paris-Charles de Gaulle, and Seoul-Incheon. The company sells its tickets through various distribution channels, including delta.com and the Fly Delta app, reservations, online travel agencies, traditional brick and mortar, and other agencies. It also provides aircraft maintenance and engineering support, repair, and overhaul services; and vacation packages to third-party consumers, as well as aircraft charters, and management and programs. The company operates through a fleet of approximately 1,200 aircrafts. Delta Air Lines, Inc. was founded in 1924 and is based in Atlanta, Georgia.

How the Company Makes Money

Delta Air Lines generates revenue through multiple streams, primarily from passenger ticket sales, which account for the majority of its income. The company offers a variety of cabin classes, each with different pricing structures, allowing them to cater to different segments of travelers. In addition, Delta earns money from cargo services, transporting freight and mail across its global network. Ancillary services such as baggage fees, seat upgrades, and in-flight purchases contribute to their revenue. Furthermore, Delta has significant partnerships and alliances with other airlines through the SkyTeam alliance, which allows for code-sharing and extended route offerings, enhancing its market reach and revenue potential. The company's loyalty program, SkyMiles, also serves as a revenue source through partnerships with credit card companies and other commercial agreements.

Delta Air Lines Financial Statement Overview

Summary

Delta Air Lines has shown significant recovery and growth with strong revenue and profitability metrics. The balance sheet reflects reasonable stability, though high leverage is a concern. Robust cash flow generation supports operational flexibility.

Income Statement

Delta Air Lines has demonstrated robust revenue growth over the past few years, with a significant recovery from the lows of 2020. The gross profit margin stands at approximately 24.1% (TTM), and the net profit margin at 5.9% indicates healthy profitability. The EBIT margin of 9.6% and EBITDA margin of 12.2% show strong operational efficiency. This consistent improvement and strong margin performance in a competitive industry justify a high score.

Balance Sheet

The company's balance sheet shows a moderate debt-to-equity ratio of 1.07, indicating manageable leverage. The return on equity is impressive at 23.7%, reflecting efficient use of shareholder funds. The equity ratio of 20% suggests a reasonable degree of financial stability. While the reduction in total debt is positive, the relatively high debt levels remain a concern, balancing the overall score.

Cash Flow

Delta's cash flow performance is strong, with a free cash flow to net income ratio of 0.77, indicating effective conversion of income to cash. The operating cash flow to net income ratio of 2.18 suggests robust cash generation capabilities. The free cash flow growth rate reflects resilience and efficient capital management, although fluctuations in capital expenditures warrant caution.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
61.93B	61.64B	58.05B	50.58B	29.90B	17.09B
	Gross Profit
15.46B	15.17B	14.13B	7.82B	-179.00M	-6.45B
	EBIT
5.95B	6.00B	5.52B	1.61B	260.00M	-12.47B
	EBITDA
7.47B	7.92B	8.78B	5.05B	3.67B	-12.35B
	Net Income Common Stockholders
3.66B	3.46B	4.61B	1.32B	280.00M	-12.38B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
3.71B	3.07B	3.87B	6.53B	11.32B	14.10B
	Total Assets
77.34B	75.37B	73.64B	72.28B	72.47B	72.05B
	Total Debt
22.28B	22.77B	27.28B	30.61B	34.62B	35.55B
	Net Debt
18.57B	19.70B	24.54B	27.34B	26.68B	27.24B
	Total Liabilities
61.90B	60.08B	62.54B	65.82B	68.84B	70.70B
	Stockholders Equity
15.45B	15.29B	11.11B	6.46B	3.63B	1.35B
Cash Flow		Free Cash Flow
2.82B	2.88B	1.14B	-2.00M	16.00M	-5.69B
	Operating Cash Flow
8.00B	8.03B	6.46B	6.36B	3.26B	-3.79B
	Investing Cash Flow
-4.33B	-3.74B	-3.15B	-6.92B	-897.00M	-9.24B
	Financing Cash Flow
-4.11B	-4.26B	-3.39B	-4.54B	-3.85B	19.36B

Delta Air Lines Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 51.19
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DAL, the sentiment is Positive. The current price of 51.19 is above the 20-day moving average (MA) of 45.72, above the 50-day MA of 44.37, and below the 200-day MA of 52.79, indicating a neutral trend. The MACD of 2.08 indicates Negative momentum. The RSI at 64.35 is Neutral, neither overbought nor oversold. The STOCH value of 70.75 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DAL.

Delta Air Lines Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
UAL	76 Outperform	$25.68B	7.17	33.57%	―	5.31%	35.95%
DAL	75 Outperform	$33.42B	9.03	27.52%	1.08%	4.91%	-27.21%
RYAAY	74 Outperform	$26.61B	15.23	21.21%	1.68%	5.39%	-15.92%
PAC	70 Outperform	$11.68B	24.12	36.66%	3.19%	-2.56%	-14.94%
Sector *	64 Neutral	$4.44B	11.99	5.16%	249.23%	4.01%	-11.87%
LUV	59 Neutral	$18.62B	38.80	5.63%	2.20%	3.26%	27.77%
AAL	57 Neutral	$7.82B	13.69	-21.27%	―	1.92%	36.07%

Delta Air Lines Corporate Events

Delta Air Lines Acquires Stake in WestJet

Delta Air Lines and Korean Air have announced their acquisition of minority stakes in WestJet, totaling 25% for $550 million, to strengthen partnerships and expand customer benefits. This strategic move aims to enhance connectivity between Canada, North America, Europe, and Asia, providing a seamless travel experience and aligning the airlines’ interests.

Spark’s Take on DAL Stock

According to Spark, TipRanks’ AI Analyst, DAL is a Outperform.

Delta Air Lines is well-positioned within the competitive airline industry, with strong financial performance and strategic initiatives like share buybacks enhancing shareholder value. However, technical indicators suggest caution, and macroeconomic challenges could impact future growth.

To see Spark’s full report on DAL stock, click here.

Delta Air Lines Announces $1 Billion Share Buyback

Delta Air Lines announced a $1 billion share repurchase program to be completed by June 30, 2028, aiming to return over $2 billion to shareholders in the next three years. This reflects the company’s commitment to reducing financial risk, reinvesting in the business, and increasing shareholder returns, supported by strong cash flow and high credit ratings.

Spark’s Take on DAL Stock

According to Spark, TipRanks’ AI Analyst, DAL is a Outperform.

Delta Air Lines is navigating a challenging environment with strong financial performance and efficient cash flow management. While valuation metrics are attractive, technical indicators suggest caution due to bearish momentum. Earnings call insights reveal macroeconomic challenges, and revised guidance highlights demand softness. Overall, Delta remains a strong player in its industry, but external economic factors pose risks.

To see Spark’s full report on DAL stock, click here.

Delta Air Lines Lowers Revenue Forecast for Q1 2025

Delta Air Lines has revised its financial outlook for the March 2025 quarter, anticipating a total revenue growth of 3 to 4 percent year-over-year, down from the initial guidance of 7 to 9 percent. This adjustment reflects a decline in consumer and corporate confidence due to macroeconomic uncertainties, impacting domestic demand. Despite these challenges, Delta’s premium, international, and loyalty revenue growth remains resilient, showcasing the company’s diversified revenue streams.