Delta Air Lines (DAL – Research Report), the Industrials sector company, was revisited by a Wall Street analyst yesterday. Analyst Tabitha Foo from DBS maintained a Buy rating on the stock and has a $50.00 price target.
Tabitha Foo has given his Buy rating due to a combination of factors including Delta Air Lines’ strong market position and resilience in the face of industry challenges. Delta Air Lines boasts a significant presence in both domestic and international markets, with a dominant passenger share in its core hubs and a substantial international network. The airline has been distinguished as the most trusted U.S. airline brand and has achieved a notable market share increase during the pandemic, specifically in corporate travel and main U.S. hubs. Delta’s strategy of differentiating its products and focusing on premium markets has resulted in a revenue premium over its competitors, with premium and non-ticket revenues now constituting a significant portion of the group’s revenue.
Furthermore, Delta Air Lines is well-positioned to benefit from the ongoing strong demand for long-haul and corporate travel, as well as robust premium leisure demand. The airline is expected to see considerable earnings growth in the coming years, supported by the resurgence of international travel, especially on lucrative transatlantic routes. Delta’s commitment to premium product enhancements and its successful loyalty program are likely to enhance its medium-term operating margin. The airline’s partnership with American Express and the anticipated growth in its loyalty program’s contribution are also positive indicators. With a focus on returning value to shareholders through potential share buybacks and dividends, and a target price based on a forward EV/EBITDA that suggests a premium valuation is warranted, Foo’s analysis concludes that Delta Air Lines’ stock is an attractive investment opportunity.
Foo covers the Industrials sector, focusing on stocks such as Delta Air Lines, United Airlines Holdings, and Qantas Airways Limited. According to TipRanks, Foo has an average return of -3.0% and a 42.86% success rate on recommended stocks.
In another report released on April 12, Wolfe Research also maintained a Buy rating on the stock with a $60.00 price target.
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Delta Air Lines (DAL) Company Description:
Georgia-based Delta Air Lines, Inc. is one of the major airlines of the United States and a legacy carrier. The company provides scheduled air transportation for passengers and cargo. It operates through the Airline and Refinery segments.
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