Delta Air Lines (DAL) Is Up After Q3 Profit Surpassed Expectations

Delta Air Lines Inc. on Wednesday launched the USA airline industry’s financial-reporting season by posting earnings that more than tripled compared with the same period past year, propelled by lower fuel costs. Delta’s shares rose more than 2 percent in afternoon trading. Revenue fell 0.6% to $11.1 billion, in line with estimates.

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Looking ahead, Delta said it will keep system capacity flat in Q4 but still sees a drop in PRASM of 2.5% to 4.5% for the quarter. P/E to growth ratio is 0.49, while t-12 profit margin is 4.58%.

The U.S airlines say the Gulf carriers have received $40 billion in government subsidies since 2004, allowing them to charge lower fares and gain market share.

Delta Air Lines, known for snapping up bargain-priced single-aisle planes, is now shopping for used larger, long-haul jets. Delta’s embrace of mid-life 777s may also help shore up values and kindle more interest among the airline’s rivals, just as Delta did with Boeing’s narrow-body 717.

Airlines also oppose a proposed requirement that ticket sellers inform consumers of the cost of a first and second checked bag, an advance seat assignment and a carry-on bag on the first computer search screen where airfares are displayed, rather than waiting until a buyer has selected a fare and is checking out. “It’s an honor to recognize the hard work of 80,000 outstanding Delta employees with over $1 billion of profit sharing accrued so far this year”. (DAL) on Wednesday reported third-quarter net income of $1.32 billion.

Delta Air Lines (NYSE:DAL)’s stock had its “overweight” rating reaffirmed by research analysts at Morgan Stanley in a research report issued on Monday, Market Beat Ratings reports. On a consensus basis, analysts have a target price objective of $60.75 per share. Its 52-week range has been $30.12 – $51.06; it is trading at discount versus its 52-week high of $51.06 achieved on Jan 23, 2015 and a premium to its 52-week low of $30.43 faced on October 15, 2014. Delta has added flights to London, Tokyo, Hong Kong and domestic destinations to turn Seattle into a major hub, and Alaska responded by adding flights to Hawaii and the Eastern U.S.to raise capacity out of Seattle by 11%.

Following the earnings release, the stock surged 2.24% and is trading at $48.8 as of 7:31 AM EDT in the pre-market trading. The stock has a 50 day moving average price of $45.76 and a 200-day moving average price of $44.46. Following the sale, the president now owns 224,621 shares of the company’s stock, valued at $9,791,229.39.

The stock, as of recent close, has shown weekly upbeat performance of 3.84% which was maintained at 9.83% in 1-month period. Linenberg has a success rate of 68.4% and is ranked #33 out of 3773 analysts, while Becker has a success rate of 81.5% and is ranked #4. Two analysts have rated the stock with a hold rating, fifteen have issued a buy rating and one has given a strong buy rating to the company. Its Refinery segment supplies the airline section from its own production with jet fuel and through jet fuel obtained through agreements with third-parties.