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Is it Time to Buy Airline Stocks After Delta's (DAL) Earnings Beat?
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Investors may be wondering if it’s time to buy airline stocks after Delta Air Lines' (DAL - Free Report) ) second-quarter results helped reconfirm travel demand remains higher.
Delta beat quarterly top and bottom line expectations this morning with United Airlines (UAL - Free Report) ) and American Airlines (AAL - Free Report) ) Q2 results approaching on July 19 and 20 respectively.
Let’s see if now is a good time to buy these major airline stocks as earnings continue to roll out.
DAL Q2 Review
Driven by robust travel demand Delta delivered the highest quarterly revenue and probability in the company’s history. Second-quarter sales came in at roughly $15.6 billion with operating income at $2.5 billion and earnings of $2.68 per share.
This impressively topped the Zacks consensus for sales and earnings estimates by 4% and 11% respectively. Year-over-year Q2 earnings soared 86% with sales climbing 13%.
Image Source: Zacks Investment Research
Delta expects pent-up demand for international travel following the pandemic to be a further catalyst going forward. Annual earnings are now forecasted to soar 94% this year at $6.21 per share compared to EPS of $3.20 in 2022. More impressive, fiscal 2024 earnings are expected to jump another 18% at $7.36 per share.
Image Source: Zacks Investment Research
UAL & AAL Q2 Preview
Aforementioned United is scheduled to release its second-quarter results next Wednesday with earnings anticipated to soar 181% at $4.02 per share compared to EPS of $1.43 in Q2 2022. Sales are expected at $13.93 billion up 15% from the prior year quarter.
United’s annual earnings are projected at $9.79 per share skyrocketing 288% from $2.52 a share in 2022. Fiscal 2024 earnings are expected to rise another 11%.
Image Source: Zacks Investment Research
Pivoting to American which will report next Thursday, Q2 earnings are projected to leap 108% at $1.58 per share up from EPS of $0.76 a year ago. Sales are expected to up 2% to $13.71 billion.
Americans’ earnings are forecasted to skyrocket a staggering 506% in fiscal 2023 at $3.03 per share compared to EPS of $0.50 in 2022. Fiscal 2024 earnings are expected to rise another 4%.
Image Source: Zacks Investment Research
Performance
All three of these major airline stocks have climbed just over 45% this year to largely outperform the S&P 500’s +17% and also top the Transportation-Airline Markets’ +38%.
Over the last year, Delta’s performance has led the way now soaring +61% and currently trading at $47 a share. At $55 a share, United is up +46% during this period followed by American’s +29% which stock trades at around $18 a share.
Notably, this has also outperformed the benchmark with only American’s stock trailing the Zacks Subindustry’s +36%.
Image Source: Zacks Investment Research
Bottom Line
At the moment Delta stock currently sports a Zacks Rank #2 (Buy) with United and American landing a Zacks Rank #3 (Hold). Delta’s second-quarter results helped reassure investors that the company is still benefiting from higher travel demand with United and American hoping to do the same next week.
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Is it Time to Buy Airline Stocks After Delta's (DAL) Earnings Beat?
Investors may be wondering if it’s time to buy airline stocks after Delta Air Lines' (DAL - Free Report) ) second-quarter results helped reconfirm travel demand remains higher.
Delta beat quarterly top and bottom line expectations this morning with United Airlines (UAL - Free Report) ) and American Airlines (AAL - Free Report) ) Q2 results approaching on July 19 and 20 respectively.
Let’s see if now is a good time to buy these major airline stocks as earnings continue to roll out.
DAL Q2 Review
Driven by robust travel demand Delta delivered the highest quarterly revenue and probability in the company’s history. Second-quarter sales came in at roughly $15.6 billion with operating income at $2.5 billion and earnings of $2.68 per share.
This impressively topped the Zacks consensus for sales and earnings estimates by 4% and 11% respectively. Year-over-year Q2 earnings soared 86% with sales climbing 13%.
Image Source: Zacks Investment Research
Delta expects pent-up demand for international travel following the pandemic to be a further catalyst going forward. Annual earnings are now forecasted to soar 94% this year at $6.21 per share compared to EPS of $3.20 in 2022. More impressive, fiscal 2024 earnings are expected to jump another 18% at $7.36 per share.
Image Source: Zacks Investment Research
UAL & AAL Q2 Preview
Aforementioned United is scheduled to release its second-quarter results next Wednesday with earnings anticipated to soar 181% at $4.02 per share compared to EPS of $1.43 in Q2 2022. Sales are expected at $13.93 billion up 15% from the prior year quarter.
United’s annual earnings are projected at $9.79 per share skyrocketing 288% from $2.52 a share in 2022. Fiscal 2024 earnings are expected to rise another 11%.
Image Source: Zacks Investment Research
Pivoting to American which will report next Thursday, Q2 earnings are projected to leap 108% at $1.58 per share up from EPS of $0.76 a year ago. Sales are expected to up 2% to $13.71 billion.
Americans’ earnings are forecasted to skyrocket a staggering 506% in fiscal 2023 at $3.03 per share compared to EPS of $0.50 in 2022. Fiscal 2024 earnings are expected to rise another 4%.
Image Source: Zacks Investment Research
Performance
All three of these major airline stocks have climbed just over 45% this year to largely outperform the S&P 500’s +17% and also top the Transportation-Airline Markets’ +38%.
Over the last year, Delta’s performance has led the way now soaring +61% and currently trading at $47 a share. At $55 a share, United is up +46% during this period followed by American’s +29% which stock trades at around $18 a share.
Notably, this has also outperformed the benchmark with only American’s stock trailing the Zacks Subindustry’s +36%.
Image Source: Zacks Investment Research
Bottom Line
At the moment Delta stock currently sports a Zacks Rank #2 (Buy) with United and American landing a Zacks Rank #3 (Hold). Delta’s second-quarter results helped reassure investors that the company is still benefiting from higher travel demand with United and American hoping to do the same next week.