Delta Air Lines (DAL) stock sailed higher out of the gate Friday after the air carrier beat top- and bottom-line expectations for its fourth quarter and issued a strong outlook for the first quarter.
In the three months ended December 31, Delta's operating revenue increased 5.7% year over year to $14.4 billion. Its earnings per share (EPS) rose 44.5% from the year-ago period to $1.85.
"Delta built momentum as we closed out 2024, with December quarter total revenue growth of 5.7% coming in ahead of guidance as our team delivered industry-leading operational performance and demand trends accelerated through the quarter," said Delta President Glen Hauenstein in a statement.
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The results beat analysts' expectations. Wall Street was anticipating revenue of $14.2 billion and earnings of $1.75 per share, according to CNBC.
For the first quarter of fiscal 2025, Delta said it expects to achieve revenue growth in the range of 7% to 9% and EPS of 70 cents to $1.00. This is ahead of the 5% revenue growth and 65 cents to 97 cents in earnings per share analysts are anticipating.
For the full fiscal year, Delta added that it expects earnings per share to grow more than 10%.
"As we move into 2025, we expect strong demand for travel to continue, with consumers increasingly seeking the premium products and experiences that Delta provides," CEO Ed Bastian said in a statement.
Is Delta stock a buy, sell or hold?
Delta Air Lines is up more than 60% in the past year and Wall Street is very bullish on the industrial stock.
According to S&P Global Market Intelligence, the average analyst target price for DAL stock is $77.06, representing implied upside of more than 13% to current levels. Additionally, the consensus recommendation is a Strong Buy.
Financial services firm Argus Research has a Buy rating on the large-cap stock with a $70 price target.
"We expect demand for leisure travel to remain strong in 2025," wrote Argus analyst John Staszak in a January 6 note. "We also expect a continued recovery in international traffic. Based on management's plans to increase unit revenue and reduce debt, we believe DAL shares are attractively valued at 7.5 times our 2025 EPS estimate."
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