Delta Air Lines, Inc. ($DAL) Earnings (Q3 FY22)

 Delta Air Lines, Inc. ($DAL) Earnings and Opinion:


Delta Air Lines is a company in the Industrials sector and operates in the Airlines industry. The company provides scheduled air transportation for passengers and cargo in the United States and internationally. Delta Air Lines was founded in 1924 and is based in Atlanta, Georgia. The company made its debut on the stock market in 2007.

Delta Air Lines Earnings Results:

  • Adj Revenue of $12.840B beating expectations of $12.833B
  • EBITDAR of $2.125B beating expectations of $2.006B
  • Adj Pre-Tax Profit of $1.276B missing expectations of $1.321B
  • Adj Net Income of $966M missing expectations of $995M
  • Adj Diluted EPS of $1.51 missing expectations of $1.54
Opinion:
Delta Air Lines is failing to find direction in todays trading session. The company is currently trading a tad bit higher, after reporting earnings before the market opened this morning. Delta credits a resurgence in Corporate travel to outpace estimates in this earnings report. While the near-term looks to be still shaky in a volatile economic environment, Delta has shown some resilience in working hard to get to pre-pandemic levels. Surprisingly, the 3 cent miss on EPS was credited to Hurricane Ian affecting travel. They are expecting to get back to 2019 levels by the middle of 2023. Diving deeper into the earnings report, it was mixed overall. The misses were slight, and the beats were slights, this shows the company is right in line to where Wall Street expects it to be. The passenger metrics look pretty solid, as the company is continually working to get back to pre-pandemic levels. Revenues are showing solid growth from the times of the pandemic, the EPS grew 579% on a YOY basis. We also see that margins are starting to expand again, and we hope that guidance is right about getting back to 2019 levels, next year. As far as valuation goes, we see that P/E ratio is at 12.90. This is below the median of all competitors. P/S sits at 0.40, which is a low valuation. Ev/EBITDA Adj is at 11.83, which is way below the competitors average. In my opinion, Delta Air Lines is a company that could be on a comeback. After a rough time during the pandemic, it seems as if the company is surging back. We can see the growth is finally coming back, and they are regularly filling planes to at least 90% capacity again. Given the valuation right now, it may be a great time to lock in a position. I see some upside in the long-term, as well as the short-term. If you are looking for an airlines stock to add into your portfolio, I think this may be the best option. Delta was probably hit the hardest, but it looks to be rebounding the best (in terms of stock performance). I am long Delta Air Lines $DAL.


*Information from Bloomberg and Yahoo Finance  

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