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Delta (DAL) Dips on Disappointing January Traffic Statistics

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Shares of Delta Air Lines, Inc. (DAL - Free Report) dipped 3.2% at the close of business on Feb 2, following the traffic release for January. Consolidated traffic, measured in revenue passenger miles (RPMs), came in at 15.64 billion, flat year over year. Traffic on the international front declined 2% year over year.

Consolidated capacity (or available seat miles/ASMs) inched up 1.8% to 19.62 billion on a year-over-year basis. Consolidated load factor or percentage of seats filled by passengers fell 150 basis points to 79.7%. This is because capacity expanded while traffic remained flat, leading to vacant seats on planes.

Additionally, the Atlanta, GA-based carrier recorded an 84.2% on-time performance and 98% completion factor (mainline) for the period under review.

Last month, this Zacks Rank #3 (Hold) company reported fourth-quarter 2017 financial numbers. On a positive note, both earnings and revenues surpassed expectations. The bottom line improved 17.1% on a year-over-year basis, aided by higher revenues. Also, the top line increased 8.3% from the year-ago figure. Strong demand for air travel during the holiday season drove the revenues. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

For the first quarter of 2018, the carrier expects operating margin within 6-8%. Fuel price including taxes and refinery impact is estimated between $2.05 and $2.10 per gallon in the same period. System capacity is anticipated to be up approximately 3% on a year-over-year basis.

The company projects total unit revenues (excluding refinery sales) to increase in the 2.5-4.5% band year over year, for the quarter. Also, non-fuel consolidated unit cost (normalized) including profit sharing is forecast to rise 2-4%.

Other key airline players like United Continental Holdings (UAL - Free Report) , Southwest Airlines (LUV - Free Report) and American Airlines (AAL - Free Report) also recently announced fourth-quarter earnings results, each better than expected.

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