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Investing.com - Citi has reiterated a Buy rating on Delta Air Lines (NYSE:DAL) stock with a price target of $62.00 following the airline’s second-quarter 2025 earnings report. This aligns with the broader analyst consensus, as InvestingPro data shows Delta trading at an attractive P/E ratio of 8.8x, with the stock currently appearing undervalued according to Fair Value analysis.
Delta reported adjusted earnings per share of $2.10 for the second quarter of 2025, exceeding consensus estimates by five cents. The quarter showed solid performance, with premium cabin revenue and co-branded card remuneration outpacing domestic main cabin revenue. The company’s strong execution is reflected in its impressive $61.9 billion in revenue over the last twelve months and a robust Financial Health Score of "GREAT" according to InvestingPro metrics.
The airline provided guidance for the third quarter that Citi described as "solid" and notably reinstated its full-year guidance. This guidance includes free cash flow of up to $4 billion, representing approximately a 12% free cash flow yield at current share price levels.
Citi indicated that these results could support Delta’s shares when trading begins on Thursday. The firm highlighted the importance of the reinstated full-year guidance as a positive signal for investors.
Delta’s performance in premium segments continues to be a strength for the carrier, with higher-margin business outperforming the main cabin domestic segment during the reported quarter.
In other recent news, Delta Air Lines reported second-quarter adjusted earnings per share of $2.10, surpassing the FactSet consensus estimate of $2.06 and Goldman Sachs’ estimate of $2.05. The airline has introduced guidance for the September quarter with an earnings per share range of $1.25 to $1.75, with the midpoint exceeding consensus estimates. Delta reinstated its full-year 2025 earnings guidance, projecting $5.25 to $6.25 per share, with the midpoint surpassing consensus expectations. In related developments, SkyWest (NASDAQ:SKYW) announced plans to purchase and operate 16 new E175 aircraft for Delta Air operations, replacing older models and enhancing their fleet strategy. Meanwhile, Goldman Sachs reiterated its Buy rating on Delta, maintaining a price target of $60, while UBS adjusted its target to $63, citing a cautious demand outlook. Jefferies raised its price target for Delta to $56, highlighting stable travel demand but maintaining a Hold rating. Additionally, French aviation authorities have requested Delta and other airlines to reduce flights to Paris and other airports due to an upcoming air traffic controller strike.
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