Delta Air Lines (DAL) Tops Q4 Earnings and Revenue Estimates
Delta (DAL) delivered earnings and revenue surprises of 46.67% and 2.58%, respectively, for the quarter ended December 2021. Do the numbers hold clues to what lies ahead for the stock?
Delta Air Lines (DAL) came out with quarterly earnings of $0.22 per share, beating the Zacks Consensus Estimate of $0.15 per share. This compares to loss of $2.53 per share a year ago. These figures are adjusted for non-recurring items.
This quarterly report represents an earnings surprise of 46.67%. A quarter ago, it was expected that this airline would post earnings of $0.15 per share when it actually produced earnings of $0.30, delivering a surprise of 100%.
Over the last four quarters, the company has surpassed consensus EPS estimates three times.
The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call.
Delta shares have added about 3.9% since the beginning of the year versus the S&P 500's decline of -0.8%.
What's Next for Delta?
While Delta has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock?
There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately.
Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.
Ahead of this earnings release, the estimate revisions trend for Delta: mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
It will be interesting to see how estimates for the coming quarters and current fiscal year change in the days ahead. The current consensus EPS estimate is -$0.55 on $8.42 billion in revenues for the coming quarter and $2.79 on $41.56 billion in revenues for the current fiscal year.
Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Transportation - Airline is currently in the bottom 4% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.
Spirit (SAVE), another stock in the same industry, has yet to report results for the quarter ended December 2021.
This airline is expected to post quarterly loss of $0.89 per share in its upcoming report, which represents a year-over-year change of +44.7%. The consensus EPS estimate for the quarter has been revised 8.7% lower over the last 30 days to the current level.
Spirit's revenues are expected to be $963.94 million, up 93.4% from the year-ago quarter.
Bitcoin, Like the Internet Itself, Could Change Everything
Blockchain and cryptocurrency has sparked one of the most exciting discussion topics of a generation. Some call it the “Internet of Money” and predict it could change the way money works forever. If true, it could do to banks what Netflix did to Blockbuster and Amazon did to Sears. Experts agree we’re still in the early stages of this technology, and as it grows, it will create several investing opportunities.
Zacks’ has just revealed 3 companies that can help investors capitalize on the explosive profit potential of Bitcoin and the other cryptocurrencies with significantly less volatility than buying them directly.See 3 crypto-related stocks now >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Delta Air Lines, Inc. (DAL): Free Stock Analysis Report
Spirit Airlines, Inc. (SAVE): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research