Delta Air Lines (DAL) has announced its quarterly earnings, falling slightly short of analysts’ expectations. The company reported earnings of $1.50 per share, missing the Zacks Consensus Estimate of $1.56 per share, a decline from the $2.03 per share earned in the same period last year. However, Delta’s revenue performance was strong, exceeding expectations with $15.68 billion in revenue for the quarter ended September 2024, surpassing the Zacks Consensus Estimate by 2% and outperforming the $15.49 billion generated in the same period last year.
While Delta has outperformed the broader market year-to-date, the question on investors’ minds is what the future holds for the company’s stock. The answer lies in understanding the company’s earnings outlook, which encompasses current earnings expectations for the coming quarters and how these expectations have evolved recently. Historical data indicates a strong correlation between short-term stock movements and changes in earnings estimate revisions.
Analyzing the recent trends in earnings estimate revisions for Delta reveals a mixed picture. Although these trends could shift following the release of the company’s latest earnings report, the current situation places Delta in the Zacks Rank #3 (Hold) category. This ranking suggests the stock is expected to perform in line with the broader market in the near future.
It will be interesting to observe how the coming quarters’ earnings estimates, as well as those for the current fiscal year, change in the days ahead. The current consensus EPS estimate for the next quarter stands at $1.82 on $14.61 billion in revenue, while the estimate for the current fiscal year is $6.17 on $59.85 billion in revenue.
Investors should acknowledge that the industry’s outlook can significantly impact the performance of Delta’s stock. The Transportation – Airline sector currently ranks among the top 20% of the 250+ Zacks industries. Research indicates that the top 50% of Zacks-ranked industries outperform the bottom 50% by a factor exceeding 2 to 1.
Sun Country Airlines Holdings, Inc. (SNCY), another company within the airline industry, is yet to report its financial results for the quarter ended September 2024. This company is projected to report quarterly earnings of $0.03 per share, representing a year-over-year decline of 78.6%. Over the past 30 days, the consensus EPS estimate for the quarter has been revised downward by 4.2% to its current level. Sun Country Airlines Holdings, Inc.’s revenue is expected to reach $252.32 million, reflecting a 1.4% increase compared to the same period last year.
As we look ahead, the company’s earnings outlook and industry trends will be crucial factors in determining Delta’s future performance. Investors will be closely watching to see how the company navigates the challenges and opportunities presented by the evolving airline industry.
