Following a rating upgrade by Cowen analysts, DAL stock appeared poised to advance for a second day on Friday.
The airline, the first significant carrier to announce profits this earnings season, missed expectations for the third quarter on Thursday but gave positive forecasts for the next three months of the year due to increasing business travel demand.
Performance of DAL Stock
Helane Becker and the Cowen analysts upgraded the company from Market Perform to Outperform on Friday. According to Becker, Delta’s fourth quarter looks promising thanks to a rebound in business and foreign travel, which has improved the company’s revenue mix. The team’s price goal is $54, which would represent a 78% increase over Thursday’s closing price.
International and higher-yielding business travelers make up a significant portion of the passenger mix in air traffic, according to Becker. She continued, “The former is directly tied to the return to government, while the latter benefits from the relaxation of pandemic limitations.” Additionally, they mentioned that Hurricane Ian, which had a $35 million effect, was “primarily to blame” for the profits shortfall.
After Labor Day, business reservations increased, reaching 80% of 2019 levels by the conclusion of the quarter, according to Delta (NYSE:DAL). It projects that sales will increase by 5% to 9% compared to the same quarter in 2019 and that adjusted earnings per share would range from $1 to $1.25. Prior to that prediction, experts predicted $0.79 per share in earnings and a 3% increase in revenue above 2019 levels.
More optimistic analysts at JPMorgan JPM +1.98% have given the company an Overweight rating and a $74 price target. The bank increased its estimate for Delta’s fourth quarter earnings per share to $1.15 from $0.61. They said in a letter on Thursday, “We continue to consider Delta as the industry leader among full-service airlines.” We think DAL will be able to weather the Covid-19 problem with greater margins.
Before the market opened on Friday, DAL stock was 3.4% higher at $31.40 after rising 4% on Thursday.
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Author Valerie Remorosa 
