On Wednesday, Delta Air Lines Inc.'s shares peaked at their highest level in three years after the company disclosed a record-breaking revenue for the first quarter. The principal driver of this expansion was an upsurge in the need for business travel.
Delta Airlines Inc. Reported An Upbeat Q1 Earnings
Delta transitioned from a net loss of $363 million (or 57 cents per share) in the corresponding period of the previous year to a net profit of $37 million (6 cents per share) for the first quarter ending March 31. The adjusted earnings per share increased from 25 to 45 cents, exceeding FactSet's 36-cent forecast.
Revenue increased by 7.8% to $13.75 billion, surpassing the consensus estimate of $12.52 billion. Delta's managed corporate sales increased by 14% annually, primarily due to the re-establishment of significant corporate clients in the technology, consumer services, and financial industries. Recent corporate surveys indicate a favorable projection, as 90% of companies anticipate travel volumes to be either stable or increase in the upcoming quarter and beyond.
Delta Q2 Forecast Is Solid
Delta (NYSE: DAL) observed that the robust demand has endured throughout the current quarter, indicating the possibility of an additional period of record-breaking revenue.
Delta's CEO, Ed Bastian, lauded the airline's remarkable operational performance, including its highest-ever operational dependability level. Delta exhibited exceptional punctuality and completion rates, surpassing the industry average by 26 days during the quarter without any cancellations.
In anticipation of the future, Delta projects revenue growth of 5% to 7% for the second quarter, which is in close concurrence with analysts' revenue consensus. The anticipated range for adjusted EPS is $2.20 to $2.50, close to FactSet's $2.22 consensus estimate.
DAL Stock Forecast Technical Analysis
In the daily chart of DAL stock price, the upbeat quarterly earnings report took the price higher immediately but failed to hold the momentum before the daily close. Looking at the broader context, the ongoing buying pressure is solid, but remains below the crucial high of 49.82 level.
In the volume structure, bulls are supporting buying pressure, as the highest activity level since July 2023 is at 42.22, below the current Delta Airlines stock price. The dynamic 20-day EMA is immediate support at the current price, while the 100-day SMA is at 41.01.
Based on this outlook, a bullish pressure is likely to happen, where a valid bullish reversal from the 45.47 to 43.00 zone could take the Delta stock price higher at the 55.42 level.
The alternative trading approach is to seek a bearish opportunity after having a valid bearish daily candle below the 44.00 psychological line.
