Delta Air Lines' Q3 2024 Earnings Skyrocket Despite Major Disasters – You Won’t Believe How They Did It!
Is Delta Air Lines a buy, sell or hold after Q3 2024 Earnings ?
Delta Air Lines has recently faced challenges, including a CrowdStrike-caused outage and Hurricane Milton, impacting its operations and financial results. Despite these setbacks, Delta reported strong financial performance with a $1.3 billion pretax income for Q3 2024 and expects to grow earnings by 30% in Q4 2024 compared to the previous year.
Fundamental Analysis
Revenue and Profitability: Delta's Q3 2024 revenue was $15.7 billion, a 1.2% increase from Q3 2023. The company achieved a pretax income of $1.3 billion, despite a $0.45 EPS impact from the CrowdStrike outage. Operating cash flow year-to-date was $6.2 billion, with free cash flow of $2.7 billion. Delta's gross leverage ended the quarter at 2.9 times, and it expects to repay nearly $4 billion of debt in 2024.
Strategic Positioning: Delta is focusing on enhancing customer experience through investments in premium products and technology, such as Delta Sync and free Wi-Fi. The company is also expanding its Delta One Lounges and expects to leverage its core hubs for growth. Delta's strategic investments align with its goal of maintaining industry leadership and financial strength.
Risks: Key risks include operational disruptions like the CrowdStrike outage, competitive pressures, and geopolitical tensions affecting travel demand. Delta's reliance on technology and its exposure to fuel price volatility also pose risks to its financial performance.
Technical Analysis
Price Movements: Delta's stock has shown volatility, with a recent high of $54.29 and a low of $30.6 over the past year. The stock is currently trading at $52.73.
Key Indicators: The RSI indicates a bullish trend, with values above 70 in recent weeks. The MACD shows positive momentum, suggesting a potential upward trend.
Support and Resistance Levels: Key support is around $30.6, with resistance at $54.29, indicating potential entry and exit points for investors.
Investment Recommendation
Valuation Insights: Delta's P/E ratio is 7.31, suggesting it may be undervalued compared to the industry average. The market cap is approximately $34 billion, with a dividend yield of 1.13%.
Short-term Outlook: Given the positive momentum and recent earnings growth, Delta is a Buy for short-term investors. The stock is expected to rise as the company recovers from recent disruptions and benefits from strategic investments.
Long-term Outlook: Delta's strong strategic positioning and financial performance suggest it is well-positioned for long-term growth. However, risks such as operational disruptions and geopolitical tensions should be monitored. Overall, Delta is a Buy for long-term investors.
Final Recommendation: Delta Air Lines is a Buy for both short-term and long-term investors, with a favorable outlook driven by strong fundamentals and positive technical indicators. The company's strategic investments and financial resilience position it well for future growth.
Explore a detailed analysis of Delta's Q3 2024 financial statement and investment recommendation based exclusively on its financial performance. https://www.askcharly.ai/share/weIwKoIbXj
Disclaimer: The information provided in this analysis is for informational purposes only and should not be considered financial or investment advice. Investors are encouraged to perform their own research and consult with a financial advisor before making any investment decisions.