Everything Is Coming Together For Delta
Adam Levine-Weinberg • 39 Comments
Adam Levine-Weinberg • 39 Comments
Wed, Feb. 24, 12:15 PM
- Delta Air Lines (DAL -0.7%) is well-positioned to handle any bounce in jet fuel costs, according to a new report from Moody's.
- The ratings agency points to Delta's "industry-leading" cash flow generation and expresses confidence in the executive team.
- "We expect Delta to continue its skillful management of its network, operations and capital-efficient growth strategy," tips Moody's.
- Further reductions in Delta's debt and interest expenses are anticipated.
- Moody's lifted its senior unsecured rating on Delta to Baa3 from Ba3 earlier this month.
- Shares of Delta have outperformed the U.S. Global Jets ETF on a YTD and 52-week view.
- Moody's release on Delta
Fri, Feb. 19, 9:05 AM
- Airline fares rose 1.2% M/M in January, according to the Bureau of Labor Statistics.
- The average fare during the month was 1.7% lower than the level from a year ago on an unadjusted basis.
- The bump in fares coincides with fuel costs still sitting at depressed levels for airline companies. Recent reports from carriers suggest that pricing has picked back up on the high end, while some markets remain highly competitive (Virgin America reported Q4 fares were down 9%).
- Related stocks: LUV, UAL, DAL, AAL, JBLU, ALK, HA, SAVE, ALGT, RJET, VA, SKYW.
- Related ETF: JETS.
- BLS CPI data
Wed, Feb. 17, 10:26 AM
- Consumer discretionary stocks associated with travel are higher as investors load up on some beat-up names after Priceline reported strong bookings growth.
- There's also a general sentiment that recession fears on Wall Street, don't necessarily add up to panic on main street.
- Notable gainers include InterContinental Hotels Group (IHG +5.4%), Stay America (STAY +4.5%), Marriott International (MAR +3%), Starwood Hotels & Resorts (HOT +3.4%), Caesars Entertainment (CZR +8.5%), Norwegian Cruise Line Holdings (NCLH +6.8%), Diamond Resorts International (DRII +6.3%), MGM Resorts (MGM +2.8%), United Continental (UAL +3.6%), Spirit Airlines (SAVE +5.6%), Delta Air Lines (DAL +3.3%), American Airlines Group (AAL +2.6%), Virgin America (VA +4.1%), Marriott Vacations (VAC +2.7%), Hyatt Hotels (H +3.2%), Wyndham Worldwide (WYN +3.4%), Southwest Airlines (LUV +3.6%), and Six Flags (SIX +3.2%).
- Previously: Priceline rallies after earnings shine (Feb. 17 2016)
- Previously: Priceline beats by $0.83, beats on revenue (Feb. 17 2016)
- Previously: Expedia, TripAdvisor rally following Priceline's Q4 beat, bookings improvement (Feb. 17 2016)
Wed, Feb. 17, 7:39 AM
- Delta Air Lines (NYSE:DAL) announces it contributed $350M in stock to its pension plans.
- The contribution is on top of the $825M in cash added to the plans earlier this year.
- The company issued 7.85M shares from its treasury which will be offset by a new $350M accelerated share repurchase plan.
Wed, Feb. 17, 3:27 AM
- U.S. and Cuban officials have signed an agreement that provides for the reopening of scheduled air services between the two nations for the first time in more than 50 years.
- The move is expected to set off a scramble among American carriers to win route rights to serve Havana, which will be capped at 20 round trips a day from anywhere in the U.S.
- According to the Department of Transportation, airlines must make their applications by March 2, with final comments and answers due March 21.
- Previously: U.S., Cuba to sign pact restoring scheduled flights (Feb. 12 2016)
- Related tickers: AAL, DAL, JBLU, LUV, SAVE, UAL, VA
Fri, Feb. 12, 6:11 PM
- In the biggest normalization development to date, U.S. officials will head to Havana Tuesday to sign a deal restarting scheduled commercial air traffic between Cuba and the United States for the first time in more than 50 years.
- The move will formalize an agreement on terms the two countries came to in December. Scheduled air traffic to Cuba from the U.S. ceased shortly after Cuba's revolution in 1959.
- Airlines will have 15 days to bid on routes for dozens of flights per day. But the deal allows for just 20 round trips per day overall between the U.S. and Havana, scarcity that could drive up bids substantially. Nine other international airports in Cuba can get 10 daily round trips.
- The Transportation Dept. will spend about a month collecting information and make a final determination on routes in the summer.
- U.S. air: DAL +0.7%, LUV +2.6%, JBLU +3.7%, UAL +2.9%, AAL +3.6%, VA +2.2%.
Fri, Feb. 12, 2:44 PM
Fri, Feb. 12, 8:22 AM
- Delta Air Lines (NYSE:DAL) employees received $1.5B in profit sharing distributions today tied to the company's record-setting year in 2015.
- Employees also received $95M in "Shared Rewards" last year tied to meeting operational goals.
Thu, Feb. 11, 12:58 PM
- U.S. refiners' windfall from cheap and plentiful crude shows further signs of running out of steam as a second refinery, Delta Airlines' (DAL -0.5%) Monroe Energy, prepares to cut output and another dumped unwanted crude, Reuters reports.
- Monroe Energy will cut output by 10% at its 185K bbl/day refinery near Philadelphia, and Valero Energy (VLO -0.1%) plans a 25% cut to gasoline output at its 180K bbl/day Tennessee refinery, according to the report.
- While the cuts are only a tiny fraction of the 18M bbl/day U.S. refining capacity, they represent a shift from a few months ago when refiners were running at full tilt to take advantage of high margins and surging demand.
- U.S. gasoline crack spreads surged nearly 30% yesterday for their best day in more than a year on the news, but few analysts expect the gains will last, as more refiners may choose to cut output rather than flood the market with products already at historic levels.
- One such company could be Phillips 66 (PSX -1.9%), which reportedly offloaded crude for immediate delivery in Cushing, Okla., at distressed prices yesterday.
Thu, Feb. 4, 7:40 AM
- Delta Air Lines (NYSE:DAL) and United Continental (NYSE:UAL) say they will offer to reassign crew members concerned about flying into regions where the Zika virus has broken out. The CDC has warned that the Zika virus can be transmitted from a pregnant mother to her fetus.
- Labor unions have criticized carriers in the past for being slow to respond to health concerns.
- Major airlines haven't weighed in yet if booking trends have changed due to the Zika epidemic.
Wed, Feb. 3, 5:05 PM
- Richard H. Anderson, Delta's (NYSE:DAL) CEO since 2007, is retiring on May 2. He'll remain with the company as executive chairman; Dan Carp will step down as non-executive chairman, while remaining on the board.
- President Ed Bastian will succeed Anderson as CEO. EVP/chief revenue officer Glen Hauenstein will succeed Bastian as President. Global sales SVP Steve Sear has been promoted to international President and EVP of global sales. Following Anderson's appointment as chairman, director Frank Blake will become Delta's lead director.
- DAL -0.4% after hours to $43.61.
Wed, Feb. 3, 1:38 PM
- Delta Air Lines, Inc. (NYSE:DAL) declares $0.135/share quarterly dividend, in line with previous.
- Forward yield 1.25%
- Payable March 9; for shareholders of record Feb. 17; ex-div Feb. 12.
Tue, Feb. 2, 10:55 AM
- Delta Air Lines (DAL -2%) reports passenger revenue per available seat miles fell 3% in January.
- Revenue passenger miles were up 3.7% to 15.574B, driven higher by domestic routes. F/X was a drag on revenue for Delta.
- Capacity rose 1.1% to 19.152B available seat miles. International capacity was down 2.6% during the month.
- January load factor +210 bps to 81.3%.
- Delta's loss today is a bit less severe than many of its airline peers.
Thu, Jan. 28, 2:19 PM
- Higher oil prices and an increased level of concern over the Zika virus have hit airline stocks.
- In one of the more curious moves, JetBlue (JBLU -7.3%) is sharply lower despite doubling profit in Q4 and topping earnings estimates.
- Other notable decliners include Virgin America (VA -4.2%), American Airlines Group (AAL -4.2%), Spirit Airlines (SAVE -3.1%), and Delta Air Lines (DAL -3.4%).
- The U.S. Global Jets ETF is down 2.33%.
- Previously: WHO issues warning on Zika virus (Jan. 28)
- Previously: JetBlue Airways beats by $0.05, beats on revenue (Jan. 28)
Sat, Jan. 23, 2:46 PM
- The economic cost of the blizzard hitting the East Coast could run as high as $850M, according to a forecast from Planalytics.
- The tally includes lost productivity and a lower level of consumer spending over the duration of the storm - even after factoring in the impact of consumers stockpiling from chains such as Home Depot (NYSE:HD), Lowe's (NYSE:LOW), Wal-Mart (NYSE:WMT), and Kroger (NYSE:KR).
- The storm is broad enough to impact domestic traffic numbers for restaurant chains (MCD, QSR, WEN, CMG, DENN, DNKN, SBUX) and movie theater operators (RGC, CKEC, CNK, AMC).
- The number of cancelled flights tied to the storm is tracking rapidly toward 10K. U.S. airlines (LUV, AAL, JBLU, UAL, DAL) have become more efficient with managing major storms, but will still take a hit to Q1 revenue.
- Looking ahead: Though harsh U.S. winters have lopped off as much as 1% to 2% from retail sales in the past, the 2015-2016 season still sits comfortably in the historical range used by economists when making their projections.
- Previously: Blizzard rally for HD, LOW, BGG, TTC, ACAT, COLM, and BDE (Jan. 22)
- Previously: Storm alert for Shake Shack and Dunkin' Donuts (Jan. 22)
- Retail ETFs: XLP, XLY, VDC, XRT, VCR, RTH, RETL, FXG, PBJ, IYK, IYC, FXD, PEJ, FDIS, RHS, FSTA, SCC, UCC, RCD, PMR, PEZ, UGE, PSL, PSCC, PSCD, SZK, BITE
Fri, Jan. 22, 8:01 AM
- Major airline carriers are considering adjusting their fuel hedging strategies after leaving some profit off the table with crude oil prices staying at depressed levels.
- United lost six full percentage points of fuel expense cost reduction in Q4 due to hedging, while no-hedging American Airlines (NASDAQ:AAL) paid on average about $0.30 less per gallon during the quarter than its large rivals.
- Executives with Delta Air Lines (NYSE:DAL), Southwest Airlines (NYSE:LUV), and United Continental (NYSE:UAL) all confirmed that a lower level of hedging may be used in the near future. One option is using hedging as catastrophic event insurance - instead of attempting to smooth out costs.
Delta Air Lines, Inc. provides scheduled air transportation for passengers and cargo throughout the United States and around the world. Its route network is centered around a system of hub and international gateway airports that it operates in Amsterdam, Atlanta, Cincinnati, Detroit, Memphis,... More
Industry: Major Airlines
Country: United States