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- Delta Air Lines Inc. expects to benefit from the new US-China visa policy. This new visa policy will allow short-term visa extensions of up to ten years for both countries.
- Delta Air Lines is in a strong position to capitalize on the forecasted growth in air travel in the next two decades which should create value for investors.
- Delta Air Lines has strengthened its business in the past few years. The consensus target price and relative valuation advocate that DAL is an attractive long-term investment.
Why Delta Is Still A Great Opportunity For Long-Term Investors
- With its own refinery, Delta has a tremendous competitive advantage.
- Q3 results provided another confirmation of the company's health.
- The stock is undervalued on a DCF analysis standpoint.
- Delta is trading at a discount compared to its competitors.
- Oil price heading for decade-long low prices, with historical parallels to oil industry developments in the 1980s and the Rockefeller era.
- Delta Air Lines emerging from massive restructuring and rebuilding phase, now pushed by low oil price tailwind to improve prospects even further.
- Every dollar saved on fuel by any airline adds directly to profitability.
- Although Delta's stock has surged 423% since the start of 2012, it is still a buy.
- Delta has compelling valuation metrics and strong earnings growth prospects; its Enterprise Value/EBITDA ratio is extremely low at 6.22.
- Delta reported better than expected results on October 16, and management assured investors that Ebola had not hit future booking trends, and Christmas bookings look solid.
- 17 of 18 analysts currently rate Delta as a ‘Buy’, with no recommendations to sell.
- The P/E ratio of 3.14 is at the lower support of the industry range.
- Delta has outperformed analysts' expectations for eight consecutive quarters.
- Delta Air Lines have edged out analysts estimates on both top and bottom line with its stellar performance.
- Its domestic refleeting has started delivering and the numbers should improve further once the process is complete.
- The company is cash rich which should aid Delta Air Lines in financing its projects.
Q3 Results Reaffirm Delta Air Lines' Potential For Investors
- Q3 Results for Delta were above analyst estimates in EPS, Revenue and EBITDA.
- Share price catalysts include lower crude prices, strong economic moat, and insulation from geopolitical factors.
- Delta remains a compelling investment in the airline sector given its corporate share gains, operational reliability and benefits from industry trends.
- Delta Air Lines reported Q3 '14 earnings.
- The stock remains a strong buy.
- The long-term tailwinds in the industry were anticipated to improve the earnings profile, but the short-term impacts of Ebola have been higher than expected.
Ebola Scare Provides Entry Point For Delta Air Lines
- Airline stocks are down due to Ebola fears, offering a low-price entry point for Delta Air Lines.
- The company has an eight out of nine Piotroski F-score, indicating financial strength.
- Delta Air Lines' PEG ratio and operating margins should entice investors.
Delta Air Lines: A True Market Leader In The Airline Industry
- Delta is showing strong valuation, which suggests that the company may still be quite cheap.
- The company is proving to be a true market leader by outperforming competitors.
- Stock movements present a great opportunity to enter the stock long in the near future.
- Delta released disappointing August traffic numbers.
- Stock remains a strong buy.
- The original investment thesis anticipated hiccups from Russia and Ebola.
- Delta has managed to increase profits from $593 million in 2010 to an impressive $2.7 billion last year.
- Delta has managed to initiate some very effective cost cutbacks in non-fuel costs of the company.
- Delta is protected from surges in fuel prices, owing to the fact that it has its own refinery in Pennsylvania.
- Delta's stock has been aided recently as oil prices have declined.
- Solid free cash flow and growing revenues have also contributed to Delta's rise as well.
- As fundamentals have improved, valuation multiples have become stretched, but share price momentum should remain.
- The United States Energy Information Administration, or EIA, forecast that average prices of both WTI and Brent crude oil will continue falling in 2014 and 2015.
- The overall effect of substantially lower oil prices will mean that people have more money to spend on discretionary items such as leisure traveling.
- Delta had a spectacular performance year in 2013, with the carrier’s profits soaring to $2.7 billion. Delta estimates that corporate spending on air travel will expand 7% in 2014.
- Delta Air Lines is a leading airline with presence in six continents. It is well positioned to reap the forecasted growth in air travel especially in the emerging markets.
- Its stock produced a fantastic 107% return in one year as a result of Delta’s zeal to attain industry leading operational efficiency.
- The capital structure re-balancing is improving its valuation.
- The consensus target price estimate reveals that Delta’s stock presents an enticing upside of 24%. Even the most conservative valuation presents an attractive upside of 11%.
Fri, Nov. 21, 3:58 AM
- Following Delta's (NYSE:DAL) $14B order for 50 wide-bodied Airbus jets yesterday, Rolls-Royce (OTCPK:RYCEY) has landed a contract to supply the engines to power them.
- The $5B contract includes Trent XWB engines to power 25 Airbus A350s and Trent 7000 engines to power 25 Airbus A330neo aircraft.
- Previously: Delta places $14B jet order with Airbus
Thu, Nov. 20, 9:12 AM
- Air fares rose 2.2% M/M in October, according to the underlying data from the Bureau of Labor Statistics. The development arrives just as jet fuel prices are moderating on forward contracts for carriers (LUV, JBLU, HA, ALK, ALGT, SAVE, AAL, DAL, UAL, RJET).
- Breakfast cereal prices rose 1.5% M/M in October. Though the gain could be due to a soft promotions-influenced comp from a year ago, sellers (GIS, K, POST) won't mind the relief.
- Another surprise might be the +4.3% average price rise in the women's dresses category. Ann (NYSE:ANN), L Brands (NYSE:LB), Cache (NASDAQ:CACH), Cato (NYSE:CATO), Chico's FAS (NYSE:CHS), and Ascena Retail (NASDAQ:ASNA) could be part of that improvement.
- BLS CPI table
Thu, Nov. 20, 4:12 AM
Wed, Nov. 19, 7:51 AM| 3 Comments
Thu, Nov. 6, 2:32 PM
- Airline stocks are on the move as lower oil prices and a continued tapering of Ebola fears boost prospects for demand.
- Capacity control has been a focus in the sector. So far, guidance from key companies this earnings season and presentations ongoing at the Raymond James Global Airline/Transportation Conference in NYC indicate U.S. carriers are keeping a nice grip on capacity.
- Advancers: JetBlue (NASDAQ:JBLU) +5.2%, Southwest Airlines (NYSE:LUV) +3.5%, Delta Air Lines (NYSE:DAL) +3.3%, United Continental (NYSE:UAL) +3.1%, Spirit Airlines (NASDAQ:SAVE) +2.9%, American Airlines Group (NASDAQ:AAL) +2.9%, Alaska Air Group (NYSE:ALK) +2.9%.
Wed, Nov. 5, 12:06 PM
- U.S. airliners aren't losing their grip on capacity control in the face of falling oil prices, say Imperial Capital analysts covering the sector.
- They note American Airlines reduced capacity in both January and February by 4% which should have a carry-over effect on pricing in many markets.
- "We expect legacy peers to by and large follow American’s lead in maintaining or even decreasing capacity despite more favorable fuel prices," writes IC.
- Regional carriers: LUV, UAL, DAL, AAL, JBLU, ALK, HA, SAVE, ALGT, RJET.
Fri, Oct. 24, 3:19 PM
- Cowen Research says Q3 earnings and guidance from airliners have surprised to the upside.
- The positive comments from airliner management on PRASM and costs coincides with some share price loss in the sector over Ebola fears.
- Q4 margins are forecast to expand as lower fuel prices factor in.
- Domestic airline stocks: DAL, AAL, JBLU, UAL, ALK, HA, RJET, ALGT, LUV, SKYW, SAVE.
Fri, Oct. 24, 1:51 PM
Tue, Oct. 21, 1:12 PM
- Airline stocks are putting in another volatile day as the Ebola headlines veer toward the positive side.
- Gainers: Spirit Airlines (NASDAQ:SAVE) +5.0%, American Airlines Group (NASDAQ:AAL) +5.3%, Southwest Airlines (NYSE:LUV) +4.7%, SkyWest (NASDAQ:SKYW) +4.1%, United Continental (NYSE:UAL) +2.9%, Delta Air Lines (NYSE:DAL) +2.5%, Allegiant Travel (NASDAQ:ALGT) +1.9%, JetBlue (NASDAQ:JBLU) +2.3%, Alaska Air Group (NYSE:ALK) +1.9%.
Mon, Oct. 20, 10:03 AM
- Fares on domestic flights are higher this year than a year ago, despite an increase in capacity across the sector, according to a forecast from Expedia EXPE.
- Thanksgiving flights showed a 17% increase on average to $467, while Christmas flights were up 2% to $493.
- A total of 21M Americans are expected to fly between October and December.
- The outlook could calm some fears that bookings or pricing are off with Ebola concerns cropping up in the U.S.
- Related stocks: DAL, AAL, JBLU, UAL, ALK, HA, RJET, ALGT, LUV, SKYW, SAVE.
Thu, Oct. 16, 7:59 AM
- Delta Air Lines (NYSE:DAL) reports passenger revenue per available seat mile rose 2.4% in Q3.
- Mainline carrier revenue +8% to $8.14B.
- Regional carrier revenue -3% to $1.63B.
- Capacity was up 3.2% across the company, led by a 16.2% gain in Latin American routes.
- Aircraft fuel expense +29% to $2.95B.
- The carrier doesn't mention Ebola in its earnings press release.
- DAL -4.2% premarket.
Thu, Oct. 16, 7:32 AM
Wed, Oct. 15, 5:30 PM
Wed, Oct. 15, 11:49 AM
- Airline stocks are under pressure again after a report indicates that the second hospital worker to contract Ebola in the Dallas region flew a commercial flight earlier this week.
- The group has been battered around on Ebola fears over the last few weeks, despite little indication of any impact on bookings so far.
- On watch: DAL, AAL, JBLU, UAL, ALK, HA, RJET, ALGT, LUV, SKYW, LFL, GOL, SAVE.
Wed, Oct. 15, 5:25 AM
- A second healthcare worker has contracted Ebola in the U.S.,
- The worker, a staff member at Texas Health Presbyterian Hospital, was among those who looked after Thomas Duncan, who died of the virus earlier this month.
- More on Ebola
- Related health stocks: TKMR, BCRX, HEB, INO, NLNK, NNVC, OTCQB:GOVX, SRPT, CMRX, GSK, IBIO, APT, LAKE, SRPT, PLX, NSPH, SMED, VSR, AHPI
- Airlines: DAL, AAL, UAL, SKYW, ALGT, HA, LUV
- Hotels: MAR, HLT, IHG, STAY, H, HOT, CHH
- Lodging REITS: AHT, SHO, LHO, INN
Tue, Oct. 14, 3:31 PM
- Global growth, foreign-exchange, oil, and small caps are the subject of every client inquiry, says David Kostin. His team's recommendation: Buy "American exceptionalism."
- In Kostin's view, U.S. economy and corporate fundamentals are still strong, with economic growth expected by Goldman economists to be 3.2% next year, the fastest expansion since 2005. Europe is expected to grow just 1%.
- What his team likes are those stocks of companies which have a high proportion of domestic sales, plus sectors like Consumer Staples (XLP -0.1%) and Discretionary (XLY +0.7%) which stand to benefit from lower oil prices (plunging again today).
- As for small caps (IWM +0.9%), Kostin is wary, noting downward earnings revisions have boosted small cap P/E ratios even as prices have declined.
- The list of S&P 500 names capturing two or more of Kostin's themes: GT, GM, PCLN, AMZN, CMCSA, LOW, DG, TSN, ADM, CVS, AVP, WAG, PXD, HAL, JPM, BAC, SCHW, PNC, MS, C, GNW, LNC, MET, THC, AET, UNH, ESRX, HUM, WLP, BIIB, GILD, DAL, CMI, FLR, CRM, JBL, MA, FB, MU, FSLR, VMC, MON, T.
DAL vs. ETF Alternatives
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