What to Expect When Delta Air Lines Reports Thursday

Delta Air Lines, Inc. (NYSE: DAL | DAL Price Prediction) is scheduled to release second quarter financial results before markets open Thursday. The consensus estimates are calling for $2.25 in earnings per share (EPS) and $12.48 billion in revenue. The same period from last year had $1.77 in EPS and $11.78 billion in revenue.

With the stock market close to all-time highs, some investors are wondering whether they should lock in their gains or step into some aspects of the market that have not caught up yet with the broader market performance.

When management told investors that it would come in at the higher end of its prior guidance, there was some renewed excitement in airlines.

Delta recently noted that it sees revenue per available seat mile up 1.5% to 3.5% in the second quarter, and the company has increased its capacity by a greater than expected 4%, for total revenue growth of 8.0% to 8.5%. Its adjusted unit costs, excluding fuel, are said to remain on track for a 1% to 2% gain, and Delta’s per-gallon fuel cost was put in a range of $2.07 to $2.12, compared with a prior range of $2.10 to $2.20.

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Excluding Wednesday’s move, Delta has performed more or less in line with the broad markets. In the past 52 weeks, the stock is up closer to 19%.

A few analysts weighed in on Delta ahead of the report:

• Imperial Capital has an In-Line rating with a $63 price target.
• Wolfe Research has a Buy rating with a $68 price target.
• Stephens has an Overweight rating with a $70 price target.
• Morgan Stanley has an Equal Weight rating with a $61 price target.

Shares of Delta were last seen up about 0.5% at $59.26, with a 52-week range of $45.08 to $61.32. The consensus analyst price target is $67.22.

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