UBS lifts Delta Air Lines stock rating to buy, target to $66

On Monday, UBS analyst Thomas Wadewitz upgraded Delta Air Lines stock from Neutral to Buy and significantly raised the price target to $66 from the previous $46. The upgrade comes as Delta, with its substantial $33.25 billion market capitalization and impressive $61.94 billion in revenue, continues to demonstrate strong financial performance. Wadewitz’s optimism stems from an anticipated recovery in corporate travel during the second half of the year, coupled with expectations of continued strength in the Premium and International travel segments. This outlook marks a shift from earlier predictions of a slowdown in these areas.

Delta Air Lines, recognized for its substantial presence in both corporate and premium international travel sectors, is expected to benefit greatly from these positive trends. According to InvestingPro data, the company is trading at an attractive earnings multiple of 8.96x and generated $3.66 billion in net income over the last twelve months. Wadewitz suggests that even without improvements in the main cabin segment, Delta is positioned to demonstrate revenue per available seat mile (RASM) growth.

The analyst foresees consensus estimates for Delta’s financial performance to increase in the upcoming months. This adjustment in projections is anticipated to act as a driving force for the airline’s stock value, potentially leading to an upward movement in the market. Discover more insights about Delta’s valuation and growth potential with InvestingPro, which offers 8 additional exclusive tips and comprehensive analysis for informed investment decisions.

Delta Air Lines, traded on the New York Stock Exchange under the ticker (NYSE:DAL), is now seen by UBS as a company capable of capitalizing on the forthcoming improvements in the travel industry. The raised price target to $66 reflects the firm’s confidence in the airline’s ability to adapt and thrive amid changing market conditions. According to InvestingPro’s Fair Value analysis, the stock currently appears slightly undervalued, suggesting potential upside for investors.

In other recent news, Delta Air Lines has been the focus of several analyst evaluations following its latest financial disclosures and strategic updates. Delta’s first-quarter earnings report exceeded expectations, with adjusted earnings per share (EPS) of $0.46, surpassing both Susquehanna’s projection of $0.40 and the consensus estimate of $0.38. This strong performance prompted Susquehanna to raise its price target to $51 while maintaining a Positive rating. UBS also adjusted its price target for Delta to $46, citing stable demand trends and a favorable competitive environment, though it maintained a Neutral rating. TD Cowen increased its price target to $50, keeping a Buy rating, despite lowering its full-year 2025 EPS forecast from $5.52 to $4.34 due to anticipated revenue deceleration.

Bernstein reaffirmed an Outperform rating with a $56 price target, noting the potential for Delta to maintain its earnings power amid economic uncertainties. Meanwhile, Raymond (NSE:RYMD) James reduced its price target to $60, continuing a Strong Buy rating, as Delta plans to limit capacity growth to preserve profit margins. This strategic move aims to align with the company’s focus on maintaining cost efficiency and financial stability. Analysts have highlighted Delta’s competitive pricing, robust loyalty program, and strategic network geography as key factors supporting its financial health. Investors will be closely monitoring Delta’s performance as it navigates the challenges and opportunities within the airline industry.

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