Delta Airlines stock performance analysis document was analyzed. Key points include: - Delta Airlines has grown to be a major US carrier offering cheap domestic and international flights. - The company has a diverse revenue stream and modern fleet which has led to strong financial performance in recent years. - Most analysts rate Delta Airlines as a "buy" and expect the stock price to continue increasing based on the company's profitability and leadership in the airline industry. - Factors like demand from investors and company earnings impact stock prices, and Delta's steady profits make it an attractive investment according to the analysis.

1. DELTA AIRLINES STOCK PERFORMANCE ANALYSIS
1
DELTA AIRLINES STOCK PERFORMANCE ANALYSIS
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Delta Airlines Stock Performance Analysis
Webster University
Introduction and Company Overview
Delta Airlines has a rich history having been started in 1929 in
Macon, GA and grew to be one of the main US carriers that
offer comparatively cheap flights. The company currently has
existing flights to Canada, Latin America, Europe, and Asia and
is headquartered in Hartsfield-Jackson Airport in Atlanta, GA.
The firm sells its tickets using different distribution channels
such as delta.com, online travel agencies, mobile applications,
telephone reservations as well as traditional brick and mortar
structures (Manuela Jr, Rhoades & Curtis, 2016). Delta has
managed to invest in a fleet of around 800 aircraft that are used
for flying clients to their destinations cost-effectively.
I became interested in Delta Airlines since I traveled with the
company and was impressed by the ability of the company to
offer quality services at very competitive rates. As a result, I
felt drawn to the brand as it was not exploitative. The brand
recognition and loyalty to the company have ensured that the
stock value of the company continues to increase. The company
has a robust air transportation infrastructure for transporting
passengers and cargo internationally as well as in the United
States (McKenna, 2018). The company bases its operations on
two segments namely refinery and Airline. The route system for
Delta Airline uses a system of markets and hubs in various
airports in many cities such as Amsterdam, Boston, Detroit,
Atlanta, Los Angeles, Minneapolis, Heathrow, La Guardia- New

2. York, JFK-New York, Charles de Gaulle-Paris, Salt Lake City,
Seattle, Narita-Tokyo, Sao Paulo, and Seoul-Incheon.
The company offers other services such as repair, maintenance,
and overhaul services; aircraft charters, vacation packages to
third party consumers as well as management and programs.
This diversification has served the company well and has made
it one of the most profitable airline companies in the United
States. The banning from March 2019 of Boeing Max 737 has
also served the company since it did not own any of such
aircraft. The exposure of other companies that have led to
massive cancellations for flights created an opportunity for the
company to increase their income (Ward, Edmondson &
Matthews, 2017). Delta Airlines has continued to over-perform
the forecasts of various analysts as well as their own during the
last 2 years which indicates the strength of the brand.
The reason why I consider Delta Airlines stock to be a
lucrative investment is based on its strong brand performance
augmented by a dependable financial track record. Delta has
always focused on enhancing most of its premium products as
well as non-ticket revenue sources, hence continuing to support
its strong revenue growth. The competitive advantage that the
company enjoys is also based on the favorable transportation
rules, efficient check-in system through internet technology as
well as a modern fleet.
The Financial performance of Delta Airlines has been
impressive as seen from the year on year performance statistics.
The company was able to improve its adjusted pretax operating
profit to 15.9% by 190 basis points (Market Realist.com, 2020).
The company continued its strong showing in the third quarter
as its traffic grew by 5.2% year on year. This was very
impressive given that this expansion in traffic outpaced its
capacity with the Deltas load factor hitting 90% after growing
by 140 basis points. According to Root (2020), the fourth-
quarter results for Delta Airline's is quite promising with the
company declaring $1.7 earnings per share which were more

3. favorable than the projected $1.5 by the company's
management. This means that an investment in the company
would allow a person to get a good return.
Data from the investor relations from the company presenting
the December highlights of the financial results showed the
increased profitability that resulted from lower fuel due to the
efficiency of the company’s refinery plants. However, it is
important to note that there was an increase in the non-fuel
operating expenses up to 4.4% which was compatible with the
expectations of the company of 4 to 5 percent.
Current Performance Consensus and Future Expectations by
Analysts
Financial analysts agree that the company has been showing
strong financial results and as such is set to increase in terms of
value. Root (2020) writing for baron.com attributed the soaring
stock price to the profitability of the company, its strong
management, and the challenges faced by other airline
companies. Analysts at yahoofinance.com all accept that the
company is going to continue its strong financial performance
with many of them labeling it as a strong buy. For the month of
February, out of 18 analysts 7 of them labeled strong buy while
the other 11 rank the company as a buy (CNN money.com,
2020). This shows that my decision to invest in the company is
a viable opportunity to make a sound investment.
Figure 1: Delta Airlines Stock price projection (Adapted from
moneycnn.com)
The recommendation of 21 polled investment analysts for CNN
money is that Delta Airlines is a viable investment which they
label as a buy. Their rating has been holding steady for most of
last year. Out of the 21analysts that were polled, 11 of them
rated the investment as a buy, 8 of them ranked it as a hold
while 2 of them considered that the investment would over-
perform. The stock price projection by the analysts determined
a median target of $70, a low estimate of $61 and a high

4. estimate of $91. This means that the stock price of the company
is set to go up hence the importance of investing in the brand
now.
Reasons for the changes in stock price
Many reasons impact stock prices and that makes it fluctuate
over time. However, the major reason for the fluctuation of
stock prices is attributable to the market forces of demand and
supply. If many people want to invest in a particular stock, the
increased demand ultimately pushes the price of the investment
up (Sainy, 2006). When the supply is high due to many people
not being interested in an investment, the price falls. The key
question, therefore, becomes what motivates people to want a
particular stock.
The key driver for the supply and demand of stocks are mainly
the perceptions of the inherent value of the market portfolio.
This value is mainly driven by the earnings of the company. In
the case of Delta Airlines, the fact that the company has been
having steady earnings which are projected to continue
improving makes the investment lucrative to many investors
which would then push the stock prices up (Min & Joo, 2016).
Negative news about a company can also affect the stock price
of a company. If investors get information that a company is
being investigated for malpractice, they would have a negative
opinion of the company which would make them dump their
holdings. The increased supply would lead to lower stock
prices.
These reasons signal that Delta Airlines is a viable investment
option due to the continuing upward trend, as well as the
inherent investor confidence in the brand. The unanimous
analyst verdicts show that the stock will continue to grow in
strength soon. This level of optimism will act as an impetus for
further growth since more investors will be drawn to the brand

5. which will increase demand for the stock pushing up the prices
further (Esky.com, 2020). This is the main reason that the
analysts in this paper have determined that the stock price of
Delta Airlines will continue going up.
Figure 2
As figure 2 above shows, Delta Airlines has been performing
quite well compared with the S&P 500 returns. In the early part
of January, the company started at a high note based on its
strong 2019 performance with the stock price dipping a little
(Delta Air Lines, 2020). However, the company has stabilized
and continues its gradual increase in returns as predicted by
many analysts.
Conclusion
Delta Airlines Inc. is one of the main airline operators in the
United States that was started in 1929 in Macon and is currently
headquartered in Atlanta, Georgia. The company currently owns
800 aircraft that are operating in a safe and rigorous schedule to
meet the needs of its clients transporting passengers
internationally as well as locally. The company has stable
operations in the USA, Latin America, Europe, Canada, and
Asia. Buy, buy, and buy!
References
Esky.com, (2020). Delta Airlines. Retrieved from
https://www.esky.com/airlines/al/dl/delta-
airlines?gclid=CjwKCAiAj-
_xBRBjEiwAmRbqYoyLWO_63d_onUASaZOI695rlZ4AU5v1JF
8nCc8XGTx_SPQ65eDahRoC-O8QAvD_BwE
CNN money.com, (2020). Delta Airlines. Retrieved from
https://money.cnn.com/quote/forecast/forecast.html?symb=DAL
Delta Air Lines, Inc. (DAL), (2020). Yahoo Finance. Retrieved
from
https://finance.yahoo.com/quote/DAL/history?p=DAL&.tsrc=fin
-srch

6. Manuela Jr, W. S., Rhoades, D. L., & Curtis, T. (2016). An
analysis of Delta Air Lines' oil refinery acquisition. Research in
Transportation Economics, 56, 50-63.
McKenna, E. (2018). Delta Airlines: A Strategic Analysis.
Market realist, (2020). Market Realist, Inc. Retrieved from
https://marketrealist.com/
Min, H., & Joo, S. J. (2016). A comparative performance
analysis of airline strategic alliances using data envelopment
analysis. Journal of Air Transport Management, 52, 99-110.
Root, A. (2020). Delta Stock Is Soaring Because Earnings Were
Way Better Than Expected. Retrieved from
https://www.barrons.com/articles/delta-stock-is-soaring-
earnings-were-way-better-than-expected-51579008408
Sainy, R. O. M. I. (2006). A study of factors affecting stock
price volatility perception of stockbrokers. Intercontinental
Journal of Finance Research Review, 4.
Ward, C. B., Edmondson, D. R., & Matthews, L. M. (2017).
Delta Airlines: Not Exactly" Flying
High". Journal of Critical Incidents, 10.
Appendix
Date
DELTA
S&P 500
Returns received FROM INVESTMENT
Stock Purchased
10,000.000

7. Adj Close
DAL Returns
Adj Close
S&P Returns
2/5/2020
58.89
0.016571707
3334.69
0.011250596
165.717
2/4/2020
57.93
0.033725892
3297.59
0.014980414
337.259
2/3/2020
56.04
0.005382113
3248.92
0.007254614
53.821
1/31/2020
55.74
-0.023817794
3225.52
-0.01770582
-238.178
1/30/2020

8. 57.1
0.007943442
3283.66
0.003134359
79.434
1/29/2020
56.65
-0.01443977
3273.4
-0.000866874
-144.398
1/28/2020
57.48
0.011437585
3276.24
0.010053584
114.376
1/27/2020
56.83
-0.033667726
3243.63
-0.015730712
-336.677
1/24/2020
58.81
-0.024224307
3295.47
-0.009042161
-242.243
1/23/2020
60.27

9. 0.010563397
3325.54
0.001140977
105.634
1/22/2020
59.64
-0.011600945
3321.75
0.000289076
-116.009
1/21/2020
60.34
-0.027244866
3320.79
-0.002651978
-272.449
1/17/2020
62.03
0.002424014
3329.62
0.003862162
24.240
1/16/2020
61.88
0.004219442
3316.81
0.008366553
42.194
1/15/2020
61.62
0.002766444

10. 3289.29
0.001870197
27.664
1/14/2020
61.45
0.032946696
3283.15
-0.001514533
329.467
1/13/2020
59.49
0.004220121
3288.13
0.006976215
42.201
1/10/2020
59.24
3265.35