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Investing.com - Goldman Sachs has reiterated its Buy rating on Delta Air Lines (NYSE:DAL) with a price target of $60.00, following the airline’s second-quarter earnings report. According to InvestingPro data, Delta currently trades at an attractive P/E ratio of 8.8x, with analysis suggesting the stock is undervalued compared to its Fair Value.
Delta reported adjusted earnings per share of $2.10 for the June quarter, exceeding the FactSet consensus estimate of $2.06 and Goldman Sachs’ estimate of $2.05, while also landing above the midpoint of the company’s guidance range of $1.70 to $2.30. The airline, with a market capitalization of $33.1 billion and trailing twelve-month EBITDA of $7.95 billion, continues to demonstrate strong financial performance. Want deeper insights? InvestingPro subscribers have access to over 30 additional key metrics and analysis tools.
The airline has introduced September quarter EPS guidance of $1.25 to $1.75, with the midpoint surpassing both consensus estimates of $1.34 and Goldman Sachs’ projection of $1.05, while expecting top-line growth to be flat to up 4% year-over-year. This optimistic outlook aligns with the broader analyst sentiment, as reflected in the strong Buy consensus recommendation from Wall Street analysts tracked by InvestingPro.
Delta anticipates its cost per available seat mile excluding fuel (CASM ex-fuel) to be flat to down year-over-year for the September quarter, compared to industry consensus and Goldman Sachs estimates of a 1% increase.
The airline has reinstated its full-year 2025 EPS guidance, which it had suspended in April, now projecting earnings of $5.25 to $6.25 per share, with the midpoint exceeding the consensus estimate of $5.38 and Goldman Sachs’ forecast of $4.65.
In other recent news, Delta Air Lines has been in the spotlight with several key developments. Jefferies raised its price target for Delta Air Lines to $56, citing stable travel demand and positive adjustments in earnings estimates, although it maintained a Hold rating due to ongoing challenges in Main Cabin bookings. In contrast, UBS lowered its price target to $63, maintaining a Buy rating while expressing caution about demand and revenue per available seat mile performance in the coming years. SkyWest (NASDAQ:SKYW) announced plans to purchase 16 new E175 aircraft for Delta Air operations, replacing older models as part of a long-term fleet strategy. Meanwhile, Delta Air Lines has raised concerns about the impact of potential new tariffs on its ability to purchase foreign-built planes, warning that such measures could disrupt services for millions of customers. Additionally, French aviation authorities have requested airlines to cut flights to Paris and other airports due to an upcoming air traffic controller strike, which may affect Delta’s operations in the region. These recent developments highlight the various challenges and strategic moves Delta Air Lines is navigating in the current market environment.
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