Why Shares Of Delta Air Lines Are Down By 3% Today?

Delta Air Lines Video 15.04.21.

Delta Air Lines Stock Moves Lower After After Quarterly Report Misses Estimates

Shares of Delta Air Lines found themselves under pressure after the company released its quarterly report.

Delta Air Lines reported revenue of $3.6 billion and GAAP loss of $1.85 per share, missing analyst estimates on both earnings and revenue. The company noted that “acceleration in demand supported positive cash generation in the month of March”, which was a notable positive development given the current market environment.

Delta Air Lines also stated that it expected positive cash generation for the June quarter in case current trends remained intact. In addition, Delta Air Lines believes that it has a chance to return to profitability in the third quarter.

The company noted that current domestic leisure bookings have reached 85% of levels seen in 2019. Obviously, international travel remains under strong pressure, and the continued problems on this front hurt Delta Air Lines’ bottom line.

What’s Next For Delta Air Lines?

Shares of Delta Air Lines had a strong start of this year as investors bet that demand for air travel will rise fast. This increase in demand is seen in the domestic market thanks to the successful mass vaccination program, but the situation on the international front remains challenging.

The company managed to get back to positive cash generation in the last month of the quarter, but it looks that this was already priced in, and the market wanted to see stronger results. It should be noted that Delta Air Lines shares have moved closer to pre-pandemic levels in recent months, so investors will likely start to pay more attention to the company’s financial results.

While the company’s earnings report was somewhat disappointing, the stock has decent chances to get back to recent highs as the summer season will likely bring positive results in the domestic market segment.

For a look at all of today’s economic events, check out our economic calendar.

Delta Airlines to Report Loss in 2021, Unless There is Significant Recovery in Traffic: Cowen

Cowen and company in their latest report said they continue to believe that Delta Airlines will report a loss this year unless there is a significant recovery of international and corporate traffic in the second half, which seems highly unlikely amid the fourth wave of coronavirus infections.

The Airline company which provides scheduled air transportation for passengers and cargo throughout the United States and across the world is expected to report its first-quarter earnings on Thursday, April 15.

Delta Airlines would report a loss for the fifth consecutive time of $2.84 in the first quarter of 2021 as the airlines continue to be negatively impacted by the ongoing COVID-19 pandemic and renewed travel restrictions.  That would represent a year-over-year decline of over 450% from -$0.51 per share seen in the same quarter a year ago.

The Atlanta-based airline’s revenue would decline more than 50% to around $3.9 billion.

In 2020, Delta Airlines reported a full-year loss for the first time in 11 years as COVID-19 travel restrictions significantly dented air travel demand, but CEO Ed Bastian said he expects 2021 to be the year of recovery.

Delta Airlines’ shares, which slumped more than 40% last year, rose about 22% to $49.27 on Friday.

“We are reiterating our Market Perform rating on the common shares of Delta Air Lines. We are increasing our price target to $53 from $44, which is based on 8.2x 2023E EPS. These shares are currently selling at ~8.2x the 2023 consensus EPS estimate, a discount to peers with higher exposure to domestic leisure traffic and a slight premium to its own historical trading range. The shares are ~20% below their pre-pandemic highs, but 2021 revenues are forecast to be ~42% below 2019 levels suggesting these shares may take a break before heading higher,” noted Helane Becker, Cowen and Company.

“We do not expect revenues to get back to 2019 levels until 2023 at the earliest. Exposure to corporate and international travel will continue to weigh on near-term results. Jet fuel pricing has recovered faster than anticipated, weighing on bottom-line forecasts in the near-term vs previous estimates. We continue to expect Delta will not recover revenue to pre-pandemic levels before 2023, unless corporate and international traffic recovers sooner than anticipated.”

Delta Airlines Stock Price Forecast

Seventeen analysts who offered stock ratings for Delta Airlines in the last three months forecast the average price in 12 months of $53.94 with a high forecast of $72.00 and a low forecast of $42.00.

The average price target represents a 9.48% increase from the last price of $49.27. Of those 17 analysts, ten rated “Buy”, seven rated “Hold” while none rated “Sell”, according to Tipranks.

Morgan Stanley gave the base target price of $72 with a high of $96 under a bull scenario and $35 under the worst-case scenario. The firm gave an “Overweight” rating on the airlines’ stock.

“We remain Overweight Delta Airlines (DAL) and are raising our price target from $55 to $72. DAL remains our top Legacy airline pick. We believe DAL’s strong franchise/customer loyalty and historical margin superiority can continue on the other side of the pandemic. On the other hand, DAL cannot wave away Legacy challenges, including delayed corporate/international travel and increased pressure on the balance sheet,”

“Nevertheless, we believe DAL is well positioned for the recovery as we see it – our estimates are 39% above consensus for FY22 and 49% for FY23. Our DCF-backed PT of $72 is about 20% above where the stock was trading in 2018-19 with a 2023 estimated EPS about 20% higher than 2019 as well.”

Several other analysts have also updated their stock outlook. Evercore ISI raised their price objective to $55 from $51 and gave the stock an overweight rating. Jefferies Financial Group raised their price objective to $50 from $40 and gave the stock a hold rating. Susquehanna Bancshares cut shares of Delta Air Lines from a positive rating to a neutral rating and raised their price objective to $45 from $42.

Check out FX Empire’s earnings calendar

Earnings to Watch Next Week: JPMorgan, Goldman, PepsiCo, BofA, Citigroup and Delta Airlines in Focus

Earnings Calendar For The Week Of April 12

Monday (April 12)

Ticker Company EPS Forecast
HDS HD Supply Holdings $0.39

Tuesday (April 13)

Ticker Company EPS Forecast
FAST Fastenal $0.37
HCSG Healthcare Services $0.28

Wednesday (April 14)

IN THE SPOTLIGHT: JPMORGAN CHASE, GOLDMAN SACHS

JPMORGAN CHASE: The leading global financial services firm with assets over $2 trillion is expected to report its first-quarter earnings of $2.06 per share, which represents year-over-year growth of over 290% from $0.78 per share seen in the same quarter a year ago. In the last four consecutive quarters, on average, the company has delivered an earnings surprise of over 6%.

The New York City-based investment bank would post revenue growth of about 6% to around $29.8 billion.

“We expect JPMorgan to likely beat the consensus estimates for revenues and earnings. The bank has outperformed the consensus estimates in each of the last three quarters, primarily driven by a jump in the Corporate & Investment Banking segment led by higher sales & trading and investment banking revenues. However, the above growth was partially offset by some weakness in the Consumer & Community Banking segment due to the lower interest rates environment. We expect the sales & trading and investment banking revenues to drive the first-quarter FY2021 results as well,” noted analysts at TREFIS.

“Further, recovery in bond yields over the recent months is likely to benefit core-banking revenues. Additionally, JPM released $2.9 billion from its loan-loss-reserve in the fourth quarter, suggesting some improvement in the perceived loan default risk. We expect the same momentum to continue in the first quarter. Our forecast indicates that JPMorgan’s valuation is around $143 per share, which is 7% lower than the current market price of around $154.”

GOLDMAN SACHS: The leading global investment bank is expected to report its first-quarter earnings of $10.10 per share, which represents year-over-year growth of about 225% from $3.11 per share seen in the same quarter a year ago. In the last four consecutive quarters, on average, the company has delivered an earnings surprise of nearly 50%.

The New York City-based bank would post revenue growth of over 31% to around $11.5 billion.

“We expect Goldman Sachs to outperform the consensus estimates for revenues and earnings. The bank has reported better than expected results in each of the last three quarters, mainly due to its strength in sales & trading and the investment banking space,” noted equity analysts at TREFIS.

“Despite the economic slowdown and the COVID-19 crisis, the company reported strong revenue growth in 2020 driven by a 43% y-o-y jump in global markets division (sales & trading) and a 24% rise in the investment banking unit. We expect the same trend to drive the first-quarter FY2021 results as well. Our forecast indicates that Goldman Sachs’ valuation is around $366 per share, which is 12% more than the current market price of around $327.

TAKE A LOOK AT OUR EARNINGS CALENDAR FOR THE FULL RELEASES FOR THE APRIL 14

Ticker Company EPS Forecast
TSCO Tesco £8.15
INFY Infosys $0.16
JPM JPMorgan Chase $3.06
GS Goldman Sachs $10.12
BBBY Bed Bath & Beyond Inc. $0.31
FRC First Republic Bank $1.54
SJR Shaw Communications USA $0.26
WFC Wells Fargo $0.69
ACI AltaGas Canada $0.51

 Thursday (April 15)

IN THE SPOTLIGHT: PEPSICO, BANK OF AMERICA, CITIGROUP, BLACKROCK, DELTA AIR LINES

PEPSICO: The company which holds approximately a 32% share of the U.S. soft drink industry is expected to report its first-quarter earnings of $1.12 per share, which represents year-over-year growth of about 4% from $1.07 per share seen in the same quarter a year ago. In the last four consecutive quarters, on average, the company has delivered an earnings surprise of nearly 6%.

The U.S. multinational food, snack, and beverage corporation would post revenue growth of over 5% to about $14.6 billion.

“Based on the 2020 performance and evolving business conditions, the company provided guidance for 2021. It expects organic revenue growth in the mid-single digits, with core constant currency EPS growth in high-single digits. It expects a core effective tax rate of 21%. Additionally, the company expects currency tailwinds to aid its revenues and core EPS by 1 percentage point in 2021, based on the current rates,” noted analysts at ZACKS Research.

“Further, it remains committed to rewarding its shareholders through dividends and share buybacks. It anticipates total cash returns to shareholders of $5.9 million, including $5.8 million of cash dividends and $100 million of share repurchases. The company recently completed its share-repurchase authorization and expects no more share repurchases through the rest of 2021.”

BANK OF AMERICA: The Charlotte, North Carolina-based investment bank is expected to report its first-quarter earnings of $0.66 per share, which represents year-over-year growth of over 60% from $0.40 per share seen in the same quarter a year ago. In the last four consecutive quarters, on average, the company has delivered an earnings surprise of over 9%.

However, the United States’ second-largest bank would see a revenue decline of more than 4% to around $21.7 billion.

CITIGROUP: The New York City-based investment bank is expected to report its first-quarter earnings of $2.52 per share, which represents year-over-year growth of 140% from $1.05 per share seen in the same quarter a year ago. But Citigroup’s revenue would decline about 12% to around $18.3 billion.

BLACKROCK: The world’s largest asset manager with $8.67 trillion in assets under management is expected to report its first-quarter earnings of $7.87 per share, which represents year-over-year growth of over 19% from $6.60 per share seen in the same quarter a year ago. The New York City-based bank would post revenue growth of about 16% to around $4.3 billion.

DELTA AIR LINES: The Airline company which provides scheduled air transportation for passengers and cargo throughout the United States and across the world is expected to report a loss for the fifth consecutive time of $2.84 in the first quarter of 2021 as the airlines continue to be negatively impacted by the ongoing COVID-19 pandemic and travel restrictions. That would represent a year-over-year decline of over 450% from -$0.51 per share seen in the same quarter a year ago.

The Atlanta-based airline’s revenue would decline more than 50% to around $3.9 billion.

TAKE A LOOK AT OUR EARNINGS CALENDAR FOR THE FULL RELEASES FOR THE APRIL 15

Ticker Company EPS Forecast
CBSH Commerce Bancshares $0.94
PEP PepsiCo $1.12
WIT Wipro $0.07
BAC Bank Of America $0.66
C Citigroup $2.52
UNH UnitedHealth $4.38
HOMB Home Bancshares $0.43
USB US Bancorp $0.95
SCHW Charles Schwab $0.79
TFC Truist Financial Corp $0.93
BLK BlackRock $7.87
JBHT J B Hunt Transport Services $1.22
AA Alcoa $0.41
PPG PPG Industries $1.57
WAL Western Alliance Bancorporation $1.47
TSM Taiwan Semiconductor Mfg $0.93
DAL Delta Air Lines -$2.84
WAFD Washington Federal $0.48

Friday (April 16)

Ticker Company EPS Forecast
CFG Citizens Financial $0.96
BK Bank Of New York Mellon $0.87
PNC PNC $2.70
ALLY Ally Financial $1.13
STT State Street $1.35
MS Morgan Stanley $1.72
KSU Kansas City Southern $1.97

 

Frontier CEO Says Now Making Money with Low Fares in Pandemic as Stock Debuts

By Tracy Rucinski

The airline started generating positive cash flow at the beginning of March, a key milestone for an industry that has been burning money after drastically scaling back flights last year as demand tanked.

Frontier is now benefiting from a recovery driven by domestic leisure travel, its specialty, flying more capacity this March than in the same month of 2019.

“Coming out of this, we’re in the best position we believe of anyone in the space given our concentration in the domestic leisure business and our ability to make money with low fares,” Biffle said in a virtual interview from New York.

The airline, owned by private equity firm Indigo Partners, whose managing partner is no-frills tycoon Bill Franke, is seeking to raise around $600 million from its initial public offering, its second attempt to go public.

Frontier on Wednesday priced its initial public offering of 30 million shares at $19 per share, the low end of its marketed range of $19-$21, likely underscoring the risks involved as the airline industry pulls out of its worst crisis.

Airline investments have been notoriously volatile in the past. The head of planemaker Boeing Co said on Wednesday the pace of vaccinations hold the key to the industry’s recovery to prior levels.

Environmental groups have called into question the industry’s plans for reducing emissions and say cheap fares such as those practiced by ultra-low-cost carriers over-stimulate the demand for air travel and contribute to global warming.

Frontier, now valued at about $4 billion, is offering 15 million shares, and will receive net proceeds of about $266 million, the carrier said.

It will use the proceeds, half going onto its balance sheet and half to Indigo and other selling shareholders, to fund growth and manage debt, including repaying some of the $150 million in government loans from a COVID-19 relief package.

That will help restore its balance sheet to near pre-pandemic levels and allow it to continue growing by 10% to 15% a year, Chief Financial Officer Jimmy Dempsey said.

The listing follows a stellar debut by Apollo Global Management-backed Sun Country Airlines last month.

Like other U.S. budget carriers, Frontier took on less debt and had a lower cash burn than large legacy airlines, creating a better financial position for a recovery that Biffle said is coming fast.

Frontier, with $1.25 billion of revenue in 2020, is targeting growth from all of its key U.S. cities beyond its home base Denver, where it has roughly 100 non-stop flights, including popular Florida destinations such as Orlando and Miami. It plans to open Tampa and Atlanta routes later this year.

The airline averted employee furloughs during the pandemic and was among the first to announce pilot and flight attendant hires. It expects to hire roughly 700 employees this year as it receives six new aircraft.

It hires roughly 100 employees per airplane, including mechanics and ground staff, the executives said.

Frontier has 156 aircraft on order with Airbus SE and the new jets will feature lighter-weight seats debuted last week to cut its fuel burn.

The airline generates 43% fuel savings compared with other U.S. airlines, making it the most fuel-efficient U.S. carrier, according to a Frontier statement last week.

“We live in Colorado,” Biffle said, adding: “ESG is real.”

(Reporting by Tracy Rucinski, Editing by Sherry Jacob-Phillips)

Why Shares Of Delta Air Lines Are Up By 5% Today?

Delta Air Lines Video 15.03.21.

Delta Air Lines Stock Moves Higher Amid Signs Of Recovery

Shares of Delta Air Lines have reached multi-month highs today after various  airlines told analysts that bookings were rising as travellers became more confident thanks to vaccination efforts. Other airline stocks like JetBlue Airways or Southwest Airlines are also moving higher today.

Delta Air Lines stated that its first-quarter revenue would decline by about 60% compared to the first quarter of 2019, an improvement from the previous forecast which called for a decline of 60% – 65%. The company’s CEO added that cash burn could soon end which will free up cash for asset purchases in the second quarter.

Other airlines also expect to report better results, so the whole segment enjoys traders’ interest in today’s trading session.

What’s Next For Delta Air Lines?

Delta Air Lines stock is currently trying to settle above the $52 level which means that the company’s shares are already close to pre-pandemic levels. The stock managed to rebound from the low at $17.51 which was reached in May 14, 2020 as traders bet that mass vaccination will ultimately boost travelling.

Right now, things are moving in the right direction for Delta Air Lines, and the market continues to push the stock higher, expecting that major improvements are around the corner.

Analysts expect that Delta Air Lines will finish the current year with a loss of $2.76 per share but estimates vary widely. The company is projected to report a profit of $3.83 per share in 2022 as the world gets back to normal thanks to vaccination programs.

At current levels, the stock is trading at less than 14 forward P/E which is cheap by today’s market standards. At the same time, airlines do not enjoy high multiples like tech stocks, and it remains to be seen whether the market will be ready to pay higher prices for shares of Delta Air Lines if analyst estimates do not move higher.

For a look at all of today’s economic events, check out our economic calendar.

S&P 500 Subdued as Focus Turns to Fed

By Shashank Nayar and Medha Singh

Delta Air Lines, Southwest Airlines and JetBlue Airways said leisure bookings are rising and offered some of the first concrete signs that the worst may be over for the airline industry.

The S&P 1500 airlines index jumped about 3.8% to a one-year high, while planemaker Boeing Co added about 2%.

Other travel-related stocks including Carnival Corp, Wynn Resorts and MGM Resorts gained between 3% and 5%.

Wall Street’s main indexes on Friday logged their best week in six as approval of a $1.9 trillion relief package and mass vaccinations fueled demand for economy-linked stocks such as banks, energy, materials at the cost of high-growth tech names.

The major U.S. stock indexes were roiled in recent weeks as a spike in longer-dated U.S. bond yields due to fears of an increase in inflation and, in response, a tapering of the Fed’s easy monetary policy worried investors.

“The U.S. economy looks in a better shape than most other developed economies,” said Hussein Sayed, chief market strategist at FXTM.

“Despite the rosier economic outlook, this week’s Fed meeting is expected to be absent of major policy changes.”

At the end of Fed’s two-day meeting on Wednesday, policymakers are expected to forecast that the U.S. economy will grow in 2021 at the fastest rate in decades while reiterating their dovish stance for the foreseeable future.

The yields on benchmark 10-year Treasuries hovered near their 13-month high at 1.61%, slightly lower than its peak of 1.64% hit on Friday.

At 9:47 a.m. ET, the Dow Jones Industrial Average rose 87.51 points, or 0.27%, to 32,866.15, the S&P 500 gained 0.29 points, or 0.01%, to 3,943.63 and the Nasdaq Composite lost 6.81 points, or 0.05%, to 13,313.11.

Five of the major S&P sectors were lower, with financials and energy leading losses.

Tesla Inc added “Technoking of Tesla” to billionaire Chief Executive Elon Musk’s list of official titles in a formal regulatory filing that also named finance chief Zachary Kirkhorn “Master of Coin”. Tesla’s shares were nearly flat.

Eli Lilly and Co shares slumped about 8.5% after “mixed” results from the drugmaker’s mid-stage trial testing its experimental drug to treat Alzheimer’s cast a doubt on the chances for the drug’s accelerated approval, according to analysts.

Advancing issues outnumbered decliners by a 1.2-to-1 ratio on the NYSE and a 1-to-1 ratio on the Nasdaq.

The S&P 500 posted 59 new 52-week highs and no new low, while the Nasdaq recorded 239 new highs and six new lows.

(Reporting by Shashank Nayar and Medha Singh in Bengaluru; Editing by Maju Samuel)

Morgan Stanley Sees Over 37% Rally in Delta Airlines; Forecasts Stock at $86 in Bull Case

Morgan Stanley raised their stock price forecast on Delta Airlines, one of the major players in the United States aviation industry, to $55 from $51 and said a decent Q1 guide and bullish commentary on the call about the potential for a traffic rebound, particularly in corporate, reinforces their bullish view on the airline space.

On Thursday, Delta Airlines reported a loss for the fourth consecutive time in the December quarter and a full-year 2020 loss for the first time in 11 years as COVID-19 travel restrictions significantly dented air travel demand but CEO Ed Bastian said he expects 2021 to be the year of recovery.

The Airline company which provides scheduled air transportation for passengers and cargo reported a quarterly adjusted loss of $2.53​​ per share, worse than the Wall Street consensus estimate of $2.47​​ per share loss.

“Despite coming into the new year on the back of tough 4Q traffic numbers amidst a third pandemic wave and the prospect of 1Q somewhat bereft of catalysts, we are very encouraged by mgmt’s confident tone on the conference call with a clear line of sight to the other side of the pandemic. We think this should result in a tide that will continue to rise and lift the airline stocks with it,” noted Ravi Shanker, equity analyst at Morgan Stanley.

“We believe Delta Airlines’ (DAL) strong customer loyalty/franchise, corporate relationships, footprint, historical PRASM/margin strength, balance sheet and mgmt. team leave them well-positioned amongst legacy peers to participate in the rebound, with the potential for an upside surprise if international/corporate volumes/PRASM can surprise to the upside in 2H21/1H22. Long-only investors returning to the sector as traffic comes back are also likely to flock to DAL, in our view, which makes the technical setup attractive as well. Our 2021/2022/2023 EPS moves to -$1.42/4.33/7.52 vs. $0.91/4.80/NA prior,”

Other equity analysts also recently updated their stock outlook. Credit Suisse raised the target price to $48 from $47. Stifel upped the stock price forecast to $49 from $39. JP Morgan lowered the price objective to $49 from $51.

In addition, Deutsche Bank lowered shares of Delta Air Lines from a “buy” rating to a “hold” rating and set a $47 target price in December. BNP Paribas began coverage and issued an “outperform” rating and a $54 price target.

Fourteen analysts who offered stock ratings for Delta Airlines in the last three months forecast the average price in 12 months at $48.83 with a high forecast of $58.00 and a low forecast of $40.00.

The average price target represents a 22.14% increase from the last price of $39.98. From those 14 equity analysts, six rated “Buy”, seven rated “Hold” and one rated “Sell”, according to Tipranks.

Delta Airlines’ shares closed 3.59% lower at $39.98 on Friday; the stock fell over 30% in 2020. Morgan Stanley’s stock price forecast suggests a potential upside of 37.57% from the stock’s current price.

Morgan Stanley also gave a target price of $86 under a bull-case scenario and $29 under the worst-case scenario. The firm currently has an “Overweight” rating on the Airline company’s stock.

“Why Overweight? Delta Airlines (DAL) has some of the strongest customer satisfaction numbers among the other Legacy peers, while also commanding a higher PRASM, making it our preferred Legacy carrier. With ample liquidity we see limited liquidity risk here,” Morgan Stanley’s Shanker added.

“Additionally, we continue to see DAL’s international alliances and partnerships as strategic assets, despite recent writedowns.”

Check out FX Empire’s earnings calendar

Delta Airlines Posts Full-Year Loss for First Time Since 2009 But CEO Bastian Eyes Recovery in 2021

Delta Airlines, one of the major players in the United States aviation industry, reported a loss for the fourth consecutive time in the December quarter and a full-year 2020 loss for the first time in 11 years as COVID-19 travel restrictions significantly dented air travel demand but CEO Ed Bastian said he expects 2021 to be the year of recovery.

The Airline company which provides scheduled air transportation for passengers and cargo reported a quarterly adjusted loss of $2.53​​ per share, worse than the Wall Street consensus estimate of $2.47​​ per share loss.

“The current operating environment will remain incredibly challenging as demand fluctuates with COVID-19 headlines & vaccine rollout. The work Delta has done on costs should provide leverage once demand improves. Delta is bullish on a second-half recovery, and there are certainly encouraging signs, but we are cautious near-term as vaccine distribution has been disappointing,” noted Helane Becker, equity analyst at Cowen and Company.

“We are reiterating our Market Perform rating on the common shares of Delta Air Lines. We are maintaining our $44 price target, which is based on 10x 2022E EPS. The air travel industry continues to be depressed by the ongoing coronavirus pandemic and related restrictions.”

The Atlanta-based airline said its revenue slumped 65.3% to $3.97 billion from a year ago​, worse than the market expectations of $3.59 billion. The company reported December quarter 2020 GAAP pre-tax loss of $1.1 billion and loss per share of $1.19 on total revenue of $4.0 billion.

For full-year 2020, the company reported GAAP pre-tax loss of $15.6 billion and loss per share of $19.49 on total revenue of $17.1 billion. Full-year 2020 adjusted pre-tax loss of $9.0 billion and adjusted loss per share of $10.76 on adjusted operating revenue of $15.9 billion.

“While our challenges continue in 2021, I am optimistic this will be a year of recovery and a turning point that results in an even stronger Delta returning to revenue growth, profitability and free cash generation,” said Ed Bastian, Delta’s chief executive officer.

Following this optimism, Delta Airlines shares closed 2.5% higher at $41.47 on Thursday. However, the stock fell more than 30% in 2020.

“Despite the pandemic, we continue to see clear reasons to expect a resounding recovery post-vaccine in both leisure and business travel. We are maintaining our $43 per share fair value estimate for Delta,” said Burkett Huey, equity analyst at Morningstar.

Delta Airlines Stock Price Forecast

Eleven analysts who offered stock ratings for Delta Airlines in the last three months forecast the average price in 12 months at $46.33 with a high forecast of $54.00 and a low forecast of $40.00.

The average price target represents an 11.72% increase from the last price of $41.47. From those 11 analysts, three rated “Buy”, seven rated “Hold” and one rated “Sell”, according to Tipranks.

Morgan Stanley gave a base target price of $55 with a high of $86 under a bull scenario and $29 under the worst-case scenario. The firm currently has an “Overweight” rating on the airlines’ stock.

Several other analysts have also recently commented on the stock. JP Morgan lowered the target price to $49 from $51. Cowen and company cut to market perform from outperform; raises target price to $44 from $36. BofA Global Research raised the price objective to $42 from $38.

In addition, Credit Suisse upped the target price to $47 from $38. UBS raised the target price to $47 from $32. Citigroup upped price objective to $48 from $38. Jefferies initiates with a hold rating and a price target of $40.

Analyst Comments

“4Q results were an expected tough end to a historically bad year for the industry, but a decent 1Q guide and bullish commentary on the call about the potential for a traffic rebound, particularly in corporate, reinforce our bullish view on the Airline space and our OW on Delta Airlines (DAL) as our top Legacy pick,” said Ravi Shanker, equity analyst at Morgan Stanley.

“DAL has some of the strongest customer satisfaction numbers among the other Legacy peers, while also commanding a higher PRASM, making it our preferred Legacy carrier. With ample liquidity, we see limited liquidity risk here. Additionally, we continue to see Delta Airlines’ (DAL) international alliances and partnerships as strategic assets, despite recent writedowns.”

Upside and Downside Risks

Risks to Upside: 1) COVID-19 Vaccine timing. 2) Business Travel Recovery. 3) Industry Rationalization & Fare Stability – highlighted by Morgan Stanley.

Risks to Downside: 1) COVID-19 Second Wave. 2) Slower International Travel Rebound. 3) DAL has a significant underfunded pension liability at 78% funded status.

Check out FX Empire’s earnings calendar

Earnings to Watch Next Week: Delta Airlines, BlackRock, Citigroup and Wells Fargo in Focus

Earnings Calendar For The Week Of January 11

Monday (January 11)

IN THE SPOTLIGHT: SYNNEX, CARNIVAL

SYNNEX: California-based business process services company’s earnings to decline to $2.89​ per share the fourth quarter, down from $4.26 per share reported the same quarter last year. The leading provider of business-to-business information technology services’ quarterly revenue will fall more than 5% to just over $6 billion from $ 6.58 billion a year ago.

“For the fourth quarter of fiscal 2020, revenues are expected between $6.45 billion and $6.65 billion. Non-GAAP net income is estimated in the range of $190.5 to $203.5 million. Moreover, the company projects non-GAAP earnings between $3.68 and $3.93 per share,” noted analysts at ZACKS Research.

CARNIVAL: The world’s largest cruise ship operator is expected to report a loss for the third consecutive time in the fourth quarter. The Miami, Florida-based company’s revenue will plunge ​nearly 100% to $142.09 million from $4.78 billion posted in the same period a year ago. Carnival is expected to report a loss of $1.83 per share, worse compared to a profit of 62 cents per share registered in the same quarter last year.

“We think the cruise industry will be one of the slowest sub-sectors to recover from the COVID-19. Cruising needs just not international travel to return, but ports to reopen, authorities to permit cruising, and the return of customer confidence,” said Jamie Rollo, equity analyst at Morgan Stanley.

“We expect cruising to resume in January 2021, and only expect FY19 EBITDA to return in FY24 given historically CCL has lacked pricing power, and EPS to take even longer given dilution of share issues and higher interest expense. We see debt doubling in FY21 vs FY19 due to operating losses and high capex commitments, and leverage looks high at 4-5x even in FY23-24e, so we see risk more equity might need to be raised,” Rollo added.

According to the mean Refinitiv estimate from eleven analysts, Carnival Corp is expected to show a decrease in its fourth-quarter earnings to -186 cents per share. Wall Street expects results to range from a loss of $-2.10 to ​a loss of $-1.64 per share, Reuters reported.

Tuesday (January 12)

No major earnings scheduled for release.

Wednesday (January 13)

Ticker Company EPS Forecast
INFY Infosys $0.16
WIT Wipro $0.06
SJR Shaw Communications USA $0.24
INFO IHS Markit Ltd $0.67
AONNY Aeon ADR -$0.11

 

Thursday (January 14)

IN THE SPOTLIGHT: DELTA AIRLINES, BLACKROCK

DELTA AIRLINES: The Airline company which provides scheduled air transportation for passengers and cargo throughout the United States and across the world is expected to report a loss for the fourth consecutive time of -$2.47 in last quarter of 2020 as the airlines continue to be negatively impacted by the ongoing COVID-19 pandemic. According to Ticket Report, analysts expect Delta Airlines to post $-11 EPS for the current fiscal year and $0 EPS for the next fiscal year.

“Delta is the airline most exposed to corporate travel, which was positive pre-pandemic. Corporate travel remains down 85% and the only corporate traveller flying now appears to be those at small and medium-sized businesses. Delta had hoped for a recovery in business travel in 2H21, but it is becoming increasingly clear that business travel will not be a meaningful contributor to revenue in 2021 as vaccination timelines continue to shift out,” said Helane Becker, equity analyst at Cowen and company.

BLACKROCK: The world’s largest asset manager is expected to report a profit of $8.66 in the fourth quarter, which represents a year-over-year change of more than +3%, with revenues forecast to grow over 7% year-over-year to $4.27 billion.

“We believe BlackRock is best positioned on the asset management barbell given leading iShares ETF platform, multi-asset & alts combined with technology/Aladdin offerings that should drive 10% EPS CAGR (2020-22e) via 5% average long-term organic growth & continued op margin expansion. We see further growth ahead for Alts, iShares, international penetration, and the institutional market in the US,” said Michael Cyprys, equity analyst at Morgan Stanley.

“We expect the premium to widen as BlackRock takes share in the midst of market dislocation and executes on improving organic revenue growth trajectory.”

TAKE A LOOK AT OUR EARNINGS CALENDAR FOR THE FULL RELEASES FOR THE JANUARY 14

Ticker Company EPS Forecast
DAL Delta Air Lines -$2.47
BLK BlackRock $8.66
TSM Taiwan Semiconductor Mfg $0.94
FRC First Republic Bank $1.52
PRGS Progress Software $0.78

 

Friday (January 15)

IN THE SPOTLIGHT: CITIGROUP, WELLS FARGO

CITIGROUP: New York-based diversified financial services holding company is expected to report a profit of $1.30 in the fourth quarter, which represents a year-over-year slump of more than 30%, with revenues forecast to decline about 10% year-over-year to $16.5 billion.

Citi is trading at just 0.7x NTM BVPS implying a through the cycle ROE of just 7%, well below our 9% estimate for 2023. While there is uncertainty around how much Citi needs to invest in technology to address the Fed and OCC consent orders around risk management, data governance and controls, we believe the stock is cheap even if expenses remain elevated. We have modelled in expenses rising to $44B for 2021 and 2022 well above $42B in 2019,” noted Betsy Graseck, equity analyst at Morgan Stanley.

“Moreover, Citi is not getting credit for its diversification (only 40% of total loans are consumer and only half of those are credit card). Citi also has a more resilient wholesale business, skewed to FX, EM and cash management.”

WELLS FARGO: The multinational financial services company is expected to report a profit of $0.58 in the fourth quarter, which represents a year-over-year slump of more than 30%, with revenues forecast to decline about 9% year-over-year to $18 billion. Seaport Global Securities also issued estimates for Wells Fargo & Company’s Q2 2021 earnings at $0.60 EPS and FY2022 earnings at $3.10 EPS.

“Net interest income is anticipated to be $40 billion for 2020, lower than the previous guidance due to lower commercial loan balances and higher MBS premium amortization. Management expects fourth-quarter origination volume to be similar to third-quarter levels despite typical seasonal declines and fourth-quarter production margins should remain strong,” noted analysts at ZACKS Research.

“The company expects internal loan portfolio credit ratings, which were also contemplated in the development of allowance, will result in higher risk-weighted assets under the advanced approach and under the standardized approach in the coming quarters, which would reduce CET1 ratio and other RWA-based capital ratios.”

TAKE A LOOK AT OUR EARNINGS CALENDAR FOR THE FULL RELEASES FOR THE JANUARY 15

Ticker Company EPS Forecast
VFC VF $0.90
JPM JPMorgan Chase $2.56
C Citigroup $1.30
WFC Wells Fargo $0.58
PNC PNC $2.59
HDB Hdfc Bank $0.54

 

3 Airline Stocks Ready for Takeoff

Coronavirus-induced stay-at-home orders and border closures have wreaked havoc on the airline industry in 2020. Furthermore, a move to remote working during the pandemic threatens to significantly reduce corporate travel moving forward. Philanthropist and Microsoft co-founder Bill Gates recently said he expects business travel to disappear by over 50% longer-term. “My prediction would be that over 50% of business travel and over 30% of days in the office will go away,” Gates told the New York Times’ Dealbook conference, per CNBC.

However, over the past month, airline stocks have flown back into favor with investors after successful COVID-19 vaccine breakthroughs give hope that pre-pandemic travel levels may return as more people take to the skies. Below, we take a look at the three largest airline stocks by market capitalization.

Southwest Airlines Co. (LUV)

The Dallas-based low-cost carrier operates over 700 aircraft in an all-Boeing 737 fleet, primarily targeting leisure and independent small business customers. Although the Federal Aviation Administration (FAA) lifted its 20-month ban of the troubled Boeing 737 Max from flying passengers Wednesday, Southwest said the jet wouldn’t re-enter service until later next year. From a technical standpoint, the share price broke out above a nine-month downtrend line that may see it retest its pre-pandemic high at $58.83. The airline has a market cap of $27.35 billion.

Delta Air Lines, Inc. (DAL)

With a market cap of $25.67 billion, Delta flies to over 300 destinations in more than 50 countries. The company announced in September that it plans to borrow $6.5 billion, backed by its frequent-flyer loyalty program to secure liquidity to ride out the tail end of the pandemic.

More recently, the full-service airline canceled one in every five flights it was scheduled to operate on Thanksgiving Day amid crew shortages brought about by the health crisis. Turning to the charts, a recent cross of the 50-day SMA back above the 200-day SMA and breakout above a multi-month downtrend line may lead to further gains toward crucial overhead resistance at $51.

United Airlines Holdings, Inc. (UAL)

United Airlines operates as a full-service carrier through its strategically located hubs in San Francisco, Chicago, Houston, Denver, Los Angeles, New York/Newark, and Washington, D.C. Last month, Raymond James’ airline analyst Savanthi Syth upgraded the airline’s stock to ‘Outperform’ from ‘Market Perform’ and reiterated the firm’s $60 price target.

Syth argues the company sits in a better position than its competitors for a travel revival after securing a pilot agreement through 2022. He also noted that United has no pending fleet retirements, allowing it to rapidly increase capacity when demand picks up. Moving on to the chart, a comprehensive breakout above a crucial downtrend line and the 200-day SMA could see the shares take flight to the January swing low at $74.34. The airline has a market value of $13.18 billion.

For a look at today’s earnings schedule, check out our earnings calendar.

United Airlines Warns Of Rising Cancellations

United Airlines Holdings Inc. (UAL) reduced guidance on Thursday, noting a deceleration in bookings and increase in cancellations as a result of the surging COVID-19 pandemic. Major airline carriers had booked stronger-than expected traffic over the summer months, as the virus faded from the front pages in most parts of the world. Several CEOs upwardly revised dismal forecasts during that period, allowing complacency to overcome common sense.

Business Travel Will ‘Go Away’

Former Microsoft Corp. (MSFT) Bill Gates put a damper on Boeing Co. (BA) and the airline sector on Wednesday, declaring that 50% of business travel will ‘go away permanently’ because of technology like the virtual meeting software offered by Zoom Video Communications Inc. (ZM). He also predicted 30% of people will be working from home in the long-term, allowing corporations to become leaner and meaner, with fewer-owned properties and multiyear leases.

United Airlines now expects fourth quarter capacity to drop ‘at least’ 55% compared to same quarter in 2019. It also guided for a 67% reduction in revenue, below prior forecasts. The company will also burn cash at a faster rate, eating up approximately $15 million to $20 million, plus $10 million of average debt principal and severance payments per day. None of these forecasts bode well for Delta Air Lines Inc. (DAL) or American Airlines Group Inc. (AAL).

Wall Street And Technical Outlook

Wall Street consensus has deteriorated in recent months, now standing at a neutral ‘Hold’ rating based upon 5 ‘Buy’, 7 ‘Hold’, and 2 ‘Sell’ recommendations. Price targets currently range from a low of $32 to a Street-high $54 while the stock is set to open Thursday’s U.S. session right at the median $41 target. Capacity news and vaccine updates should drive price action into 2021 with this mid-range placement, suggesting limited upside.

The stock posted an all-time high at 97.85 in 2018 and entered a narrow consolidation that broke to the downside in February 2020, also breaking multiple support levels going back to 2013. The 2016 low in the upper 30s is now getting tested while continued upside will run into a buzz saw of resistance in the 50s, where the 2017 low and 200-week moving averages are narrow-aligned. On the downside, bears will gain control of the tape if a selloff pieces rising 2020 lows near 30.

For a look at all of today’s economic events, check out our economic calendar.

Pfizer Vaccine Breakthrough Boosts Markets

Pfizer And BioNTech Report Great Results From Their Large-Scale Study Of COVID-19 Vaccine

S&P 500 futures have recently received a major boost after Pfizer and BioNTech COVID-19 vaccine was found to be more than 90% effective in the first analysis of the large study.

Vaccine news provided significant support to stocks, and S&P 500 futures are gaining more than 4% in premarket trading. Not surprisingly, shares of vaccine developers are gaining a lot of ground ahead of the market open – Pfizer shares are up by 12% while BioNTech stock is up by more than 23%.

Meanwhile, WTI oil managed to return back above the $40 level as vaccine news increased hopes for a successful rebound of oil demand. At the same time, precious metals like gold and silver are under pressure as traders dump safe haven assets amid optimism about the vaccine.

Stay-At-Home Stocks Suffer On Vaccine News

While the vaccine news are positive for most stocks, shares of some companies are under major pressure in premarket trading.

Zoom and Peloton, which were one of the major winners during the pandemic, are down by almost 13%, and even Amazon is under pressure in premarket trading. As a result of the pressure on stay-at-home stocks, the tech-heavy Nasdaq is set to open higher by a modest 0.5%.

It remains to be seen whether vaccine news will trigger a real rotation from tech stocks into more cyclical stocks, but stay-at-home stocks will certainly have a very challenging trading session today.

Airline And Cruise Line Stocks Jump In Premarket Trading

Today, investors look ready to bet on beaten stocks like airlines and cruise lines. For example, American Airlines Group is up by 25% while Delta Air Lines  is gaining 18% in premarket trading.

Investors are even more optimistic about cruise lines like Carnival Corp. or Norwegian Cruise Line Holdings as an effective vaccine against COVID-19 may make the difference between bankruptcy and profitable business for these companies.

Traders should expect plenty of volatility in these stocks in the upcoming trading sessions as the market will try to find new price levels which take vaccine news into account.

For a look at all of today’s economic events, check out our economic calendar.

Delta Air Lines to Raise $9 billion Against SkyMiles Loyalty Program

Delta Air Lines, which provides scheduled air transportation for passengers and cargo throughout the United States and across the world, said on Thursday that it will upsize SkyMiles financing to $9 billion, $2.5 billion higher than previously anticipated deal size.

The Atlanta-based company said on Thursday the total proceeds are being raised at a blended average annual rate of 4.75%. Delta said on Monday that it is pledging its loyalty program to raise $6.5 billion, comprising of $4 billion bonds and $2.5 billion loans, as it burns through $27 million a day, Reuters reported.

Delta Air Lines’s shares closed 1.76% lower at $33.96 on Thursday; the stock is down over 40% so far this year.

Delta Air Lines stock forecast

Nine analysts forecast the average price in 12 months at $39.17 with a high forecast of $50.00 and a low forecast of $32.00. The average price target represents a 15.34% increase from the last price of $33.96. From those nine equity analysts, six rated “Buy”, three rated “Hold” and none rated “Sell”, according to Tipranks.

Morgan Stanley gave a target price of $50 with a high of $80 under a bull-case scenario and $22 under the worst-case scenario. BofA Global Research raised their price objective to $36 from $31.

Other equity analysts also recently updated their stock outlook. Stifel cuts price target to $44 from $45; Cowen and Company lowered their stock price forecast to $32 from $33; Berenberg cuts target price to $32 from $35, while JP Morgan and Citigroup raised their target price to $45 from $41 and $38 from $30, respectively.

Analyst views

“DAL has some of the strongest customer satisfaction numbers among the other Legacy peers, while also commanding a higher PRASM, making it our preferred Legacy carrier. With ample liquidity we see limited liquidity risk here. Additionally, we continue to see DAL’s international alliances and partnerships as strategic assets, despite recent writedowns,” said Ravi Shanker, equity analyst at Morgan Stanley.

Forward Outlook

2021 planning is expected to be one of the toughest on record. DAL sees 2021 being anywhere from 25-40% down vs. 2019 levels. Longer-term, they ultimately don’t expect the environment to look much different than pre-COVID with similar network patterns once things have returned to normal, according to Morgan Stanley.

Check out FX Empire’s earnings calendar

Delta Air Lines Bookings Have Stalled Once Again

Delta Air Lines Inc. (DAL) is trading lower in Tuesday’s U.S. session after reporting a Q2 2020 loss of $4.43 per-share, $0.19 worse than consensus estimates. Revenues matched low expectations at $1.47 billion, which marks a stomach-churning 88.3% year-over-year decline. The company warned that bookings have stalled once again after April and May upticks due to the surging pandemic in more than half of the American states.

Delta Air Lines Bookings Stall

Company executives now expect Q3 revenue will be just 20% to 25% of income posted in Q3 2019, adding to a cash burn that’s undermining the balance sheets of nearly all airlines around the world. They also warned that business travel may never return to pre-pandemic levels due to the rapid adoption of virtual meeting spaces by hundreds of corporations. Finally, they announced that middle seats would remain blocked, unlike rivals United Airlines Holdings Inc. (UAL) and American Airlines Group Inc. (AAL).

In a Tuesday interview, CEO Ed Bastian admitted the company will be forced to raise additional capital in the next few months, further diluting current shares. He indicated that cash burn currently stands at $27 million per day but insists the company has at least 19 months of cash left, even if they don’t raise additional capital. Remarkably, Bastian also noted that corporate travel is now less than 5% of total revenue, highlighting the exodus of their most important profit source.

Wall Street And Technical Outlook

Wall Street consensus now rates Delta Air Lines as a ‘Strong Buy’, assembled from 9 ‘Buy’ and 3 ‘Hold’ recommendations. Oddly, no analyst is recommending that shareholders sell their positions at this time. This unbridled optimism seems unwarranted, given obvious industry challenges in the next one to two years. Price targets range from a low of $26 to a street high $47 while the stock is now trading just a few cents below the low target.

Technically speaking, there isn’t much to love about Delta Air Lines, which has struggled to book positive returns since January 2018. It broke down from a multiyear topping pattern in the first quarter and fell to a 7-year low in May while the bounce into June failed to remount a single broken support level. As a result, a decline from the current price could easily reach and break the second quarter low, continuing the developing downtrend.

Rolls Royce drags on the FTSE100, as SAP Boosts the DAX

Investors appear to be making the conscious decision to find safety in the US trillion-dollar big caps rather than move their capital into the traditional safe haven of government bonds.

Asia markets have taken their cues from yesterday’s positive US session, despite the continued rise in coronavirus cases across the US, and which US Federal Reserve President Loretta Mester expressing concern that the rising virus count is introducing increased downside risks to the US economic recovery. On Wednesday we saw Texas set a new record for daily cases, hospitalisations hit a new high in California, while Arizona posted a new record number of deaths.

After two successive negative European sessions, markets here in Europe have taken their cues from yesterday’s recovery in US markets and this morning’s positive Asia session, opening modestly higher, though still well off their peaks from Monday, and struggling to make much in the way of headway early on.

If anything, the rising coronavirus case count in the US, is helping to weigh down any confidence in a more global recovery in equity markets, however on the plus side there doesn’t appear to be any evidence of a second wave here in Europe so far as various lockdown measures continue to get eased.

While this is positive for markets in Europe the lack of any imminent agreement between EU leaders on any pandemic recovery fund appears to be deterring a wholesale move of capital back into European markets for the time being.

The problems in the aerospace sector continued to be laid bare this morning as Airbus the European plane maker reported that it had failed to obtain any new aircraft orders for the third month in succession. This is equally bad news for Rolls Royce who have been having difficulties of their own, as they reported their latest first half numbers this morning.

Last Friday there were reports that Rolls Royce was looking at reinforcing its balance sheet further by raising additional capital, or disposing of some of its assets with ITP Aero, its Spanish operation one likely option. There was no mention of raising additional capital in todays’ Q2 update which has seen management say that they expect a better performance in the second half of the year.

Good progress has been made in reducing one-off costs with £300m achieved in H1, with another £700m expected by the end of 2020. The company also said it would be taking a charge of £1.45bn over the next 6 years, in respect of reducing the size of its hedge book, with £100m of that charge being taken this year and £300m in 2021 and 2022, and then £750m spread over 2023 to 2026.

The company also said that they had pro-forma liquidity of £8.1bn, including an undrawn credit facility of £1.9bn, and commitments for a new 5-year term loan facility of £2bn underwritten by a syndicate of banks and a partial guarantee from UK Export Finance. The company also took a £1.45bn write down in respect of hedges spread over 6 years.

Not all sectors are in the doldrums, with the increasing focus on cloud technology, helping to benefit the tech sector, as more and more business moves on line. This morning German software giant SAP reported an improvement on its Q1 numbers, with cloud revenues rising 21% in Q2, driven by improvements in its Asia markets.  This outperformance in SAP has helped underpin the DAX in early trade this morning.

Rio Tinto this morning announced it was closing its New Zealand operations as an aluminium supply glut takes its toll on its profits.

In the wake of yesterday’s budget measures on stamp duty, house builder Persimmon announced its latest first half update.

Unsurprisingly given the lockdowns in April total revenues fell to £1.19bn, down from £1.75bn in 2019, with completions sharply lower at 4,900, down from 7,584. On the plus side average selling prices were modestly higher at £225k, however higher costs are likely to eat away at overall margins in the months ahead, which could act as a drag on profitability.

Much will depend on whether the removal of stamp duty for properties up to £500k will offset any loss of confidence prospective buyers have about the economic outlook. Recent mortgage approvals data suggests that consumers are becoming much more cautious.

In terms of future expectations there does appear to have been a fairly strong rebound since sales offices reopened with forward sales up 15% from the same period last year, helping to push the shares higher in early trade.

Vistry Group also posted a positive first half update, delivering a total of 1,235 completions in H1, down from 3,371 a year ago, with an average selling price of £290k. Revenue was sharply lower at £344m, down from £854m in 2019. Forward sales saw an improvement to £1.66bn, up from £1.5bn at the end of May.

Real estate investment trusts have had a rough time of it recently, with Intu going into administration only recently. Workspace Group has been one of those companies that have done things a little differently over the last ten years, in terms of how it sold its office space, and that has helped cushion it to some extent, due to its focus on small or micro businesses, selling flexible office space, and short-term leases with superfast connectivity.

This does appear to be reflected in this morning’s Q1 update, which has seen the company report cash collection of rents at 75%, net of rent reductions and deferrals. The company has received 65% of rents due in Q2, compared to 80% a year ago. Activity in its business centres has remained low at 15% of normal. Demand is now picking up as lockdowns get eased further.

Building materials and DIY retailer Grafton Group has seen its shares rise in early trading after it reported H1 numbers, which saw revenues fall 19.4% to just over £1bn. June trading has proved to be more resilient, with revenues 11.4% higher than the same period last year.

Boohoo shares are also sharply higher this morning as buyers start to return after the precipitous falls of earlier this week, with some saying that the declines have been too severe, when set against the underlying long-term fundamentals.

US markets look set to open modestly lower against this morning’s rather indifferent European session, with the main focus once again set to be on the latest weekly jobless claims numbers, and in light of the recent re-imposition of lockdowns, the main focus will once again be on continuing claims and whether that number starts to edge up again in the weeks ahead. This could take some time to be reflected in the numbers with continuing claims expected to fall below 19m to 18.95m.

Weekly jobless claims are expected to fall to 1.37m.

Bed Bath and Beyond shares are also expected to be in focus after the company announced the closure of 200 stores over 2 years due to a 50% fall in sales.

Delta Airlines is also expected to give its latest Q2 update and it’s not expected to paint a pretty picture. Delta had a standout 2019 largely due to its reliance on sales of Premium class tickets. Business travel, which a lot of national carriers rely on, is likely to see a big drop off in the months ahead as companies realise that lots of meetings can take place just as easily on Zoom and other remote conferencing facilities.

Year on year revenue for Q2 is expected to decline by 90%, with the carrier losing 85% of its flight capacity at the height of the pandemic, while losses are expected to come in at $4.43c a share. Delta expects to add 1,000 new flights to be scheduled this month, and another 1,000 in August.

Dow Jones is expected to open 60 points lower at 26,007

S&P500 is expected to open 4 points lower at 3,166

For a look at all of today’s economic events, check out our economic calendar.

By Michael Hewson (Chief Market Analyst at CMC Markets UK)