Is Delta a worthy consideration - Earnings Calendar (07Jul25)
Earnings Calendar (07Jul25)
I am interested in a few of the coming earnings like Levi’s, Delta and Vista.
Let us look at Delta.
Technical Analysis has recommended a “Strong Buy” rating. The stock price has risen 11.8% from a year ago.
The analysis below is completed with inputs from Grok.
Revenue
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Growth Trend: Delta's revenue has shown a strong upward trend, increasing from $40.704 billion in 2015 to $61.643 billion in 2024. The 10-year compound annual growth rate (CAGR) for revenue is approximately 4.4%, reflecting steady expansion despite economic cycles.
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Competitive Advantage: Delta’s consistent revenue growth highlights its strong position in the U.S. airline industry, supported by its extensive domestic and international network, premium offerings, and loyalty programs like SkyMiles.
Operating Profit
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Growth Trend: Operating profit has fluctuated significantly, dropping from $7.802 billion in 2015 to a loss of over $4 billion in 2020 due to the pandemic, then recovering to $5.995 billion in 2024. The 10-year trend shows resilience.
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Competitive Advantage: Delta’s ability to rebound from significant losses demonstrates operational resilience and cost management, bolstered by its diversified revenue streams and premium service model.
Earnings Per Share (EPS)
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Growth Trend: EPS has been volatile, rising from $5.63 in 2015 to $5.33 in 2024. There were negative EPS during the pandemic years.
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Competitive Advantage: The overall EPS growth, despite volatility, highlights Delta’s ability to generate shareholder value over time, supported by its strong brand and operational efficiency.
Price-to-Earnings (P/E) Ratio
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Valuation: The P/E ratio is 9.1, suggesting Delta is undervalued relative to its earnings, aligning with the cyclical nature of the airline industry.
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Competitive Advantage: The low P/E ratio and strong ROE reflect Delta’s efficient capital use and market perception of value, supported by its premium positioning and operational strength.
Overall Assessment
Over the past 10 years, Delta Air Lines has demonstrated resilience and growth, with revenue increasing at a 4.3% CAGR and EPS at a 21.2% CAGR, driven by its leadership in the U.S. airline market. Operating profits rebounded to $6.303 billion in 2024 after a significant loss in 2020, reflecting operational recovery. The company resumed dividends at $0.50 in 2024, and its P/E ratio of 9.1 suggests undervaluation. Modest FCF growth and a manageable debt profile support its financial flexibility. Delta’s competitive advantages include its extensive network, premium service offerings, loyalty program, and operational efficiency, positioning it well in the airline industry. However, its performance remains sensitive to economic cycles and fuel costs, as seen in the 2020 downturn, requiring continued strategic focus as of July 2025.
Delta Air Lines coming earnings have a forecast of $2.05 and $15.42B for the EPS and revenue, respectively.
From the above, Delta can be a good consideration for our portfolio. Let us invest based on our circle of competence and research before investing.
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