- Delta Air Lines has restored its full-year guidance, projecting adjusted EPS between $5.25 and $6.25, slightly above the estimate of $5.35.
- The company forecasts adjusted free cash flow of $3 billion to $4 billion, surpassing the estimate of $2.63 billion.
- Delta aims to keep adjusted gross leverage below 2.5x.
- For the third quarter, Delta predicts adjusted EPS between $1.25 and $1.75, with an estimate of $1.33.
- The adjusted operating margin is expected to range from 9% to 11%, while total revenue might remain flat or grow by up to 4%.
- In the second quarter, Delta reported an adjusted EPS of $2.10, outperforming the estimate of $2.07.
- Adjusted revenue reached $15.51 billion, a 0.6% year-over-year increase, exceeding the estimate of $15.45 billion.
- Passenger revenue rose to $13.87 billion, a 0.2% year-over-year increase, aligning closely with the estimate of $13.84 billion.
- Cargo revenue climbed by 6.5% year-over-year to $212 million, above the estimate of $206.4 million.
- The passenger load factor was 86%, slightly down from 87% year-over-year.
- Available seat miles increased by 4% year-over-year to 77.65 billion, close to the estimate of 77.69 billion.
- Revenue passenger miles grew by 1.8% year-over-year to 66.42 billion, despite being below the estimate of 67.33 billion.
- Adjusted net income was $1.37 billion, experiencing a 10% year-over-year decline, yet surpassing the estimate of $1.34 billion.
- Yield per passenger mile decreased by 1.6% year-over-year to 20.88 cents.
- The demand trends have stabilized, showing resilience in high-margin revenue streams.
- Premium revenue saw a 5% year-over-year growth, outperforming the main cabin.
- Corporate demand remains steady with domestic sales growing slightly year-over-year.
- The third quarter is expected to have the best non-fuel unit cost performance of the year, with costs flat or lower compared to 2024.
- Delta plans to pay down $3 billion of debt in 2025 and will increase its quarterly dividend by 25% beginning in the September quarter.
Delta Air Lines on Smartkarma
Analyst Coverage on Delta Air Lines
Independent analyst Baptista Research on Smartkarma recently published a report titled “Delta Air Lines’ Strong 2024: Record Profits.” The analysis detailed Delta Air Lines‘ robust performance in the December quarter and full year 2024, boasting a record pretax profit of $1.6 billion. Delta surpassed its own earnings guidance, achieving $1.85 earnings per share. The report highlighted Delta’s industry-leading operational performance, with the highest system completion factor and on-time performance among peers. Throughout 2024, Delta maintained exceptional operational standards, with 78 “Brand Perfect” days and receiving Cirium’s Platinum Award for operational excellence for the fourth consecutive year.
A look at Delta Air Lines Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 3 | |
| Dividend | 2 | |
| Growth | 5 | |
| Resilience | 3 | |
| Momentum | 4 | |
| OVERALL SMART SCORE | 3.4 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
Delta Air Lines, Inc. is positioned for solid long-term growth according to the Smartkarma Smart Scores. With a top score of 5 in Growth, the company is expected to expand and increase its market presence steadily. This is further supported by a Momentum score of 4, indicating strong upward momentum in the company’s performance. Additionally, Delta scores a respectable 3 in Resilience, which suggests it has the capability to weather economic challenges and disruptions effectively. While the Value score of 3 is moderate, indicating a fairly priced stock, the Dividend score of 2 might not be as attractive for income-seeking investors.
Overall, Delta Air Lines stands out for its growth potential and positive momentum in the market. The company’s strong emphasis on expanding its operations and network bodes well for its future outlook. Although not the highest in all areas, the combination of solid Growth, Momentum, and Resilience scores positions Delta as a competitive player in the airline industry. Investors looking for long-term growth opportunities may find Delta Air Lines an appealing prospect based on its Smartkarma Smart Scores assessment.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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