Consumer Discretionary

We cut our 12-month target price by $12 to $45, 6.9x our 2024 EPS view (cut to $6.49 from $7.24; 2023’s lowered to $6.05 from $6.21), below 2018-2019’s forward P/E average of 8.5x. We think a discount is merited due to rising unit costs. Q3 EPS of $2.03 vs. $1.51 beat consensus by $0.08. Q3 passenger revenues were up 14% Y/Y, driven by its international segment (+35%). DAL revised its 2023 outlook, expecting earnings of $6.13/share at the midpoint (vs. prior midpoint of $6.50/share) and lifted its guidance for revenue growth to ~20% (vs. the prior range of 15%-20%). In addition, DAL revised its free cash flow outlook to $2B (vs. prior $3B) due to rising fuel and maintenance costs. Nonetheless, DAL noted that demand continues to remain steady as we enter the early stages of the peak holiday travel period. In addition, DAL guided that corporate travel is steadily

Delta Air Lines’ latest quarter was good, but also volatile when it comes to fuel prices, CEO Ed Bastian says in an interview with CNBC. “We don’t look at fuel prices quarter to quarter and beat our brains about it,” he says. “We know that we have to recalibrate and fuel prices will have to find a way into pricing and that’s what we’re working on doing,” Bastian adds. When asked about consumer demand for the 4Q, Bastian says the company is benefiting from international and corporate travel demand.

Corporate travel is making a strong comeback, Delta Air Lines’ CEO Ed Bastian says in an interview with CNBC. The airline has regained at least 10 points of market share when it comes to corporate travel in the past 30 to 40 days. Bastian says the boom has been driven by return-to-office mandates, particularly those involving small businesses. Regarding the international travel market, Bastian says it is “way too early to draw any conclusions” on the potential impact of the booming market due to the war between Israel and Hamas. “We haven’t seen it [an impact] as this point,” Bastian says.

Delta Air Lines’ consumers are being hit by inflation, just like the airline is seeing higher oil, maintenance, and labor costs. “At some point we’re going see a knock on effect,” CEO Bastian says in an interview with CNBC. Still, the airline’s consumer is more on a premium end of the spectrum, Bastian says. “Our consumers are healthy and continuing to prioritize travel as one of their main discretionary drivers,” he adds. “Everything in that space [hospitality, entertainment] continues to break records and I see that trend continuing,” Bastian says.

Delta Air Lines (NYSE:DAL) Sees FY Free Cash Flow of $2B。

Delta Air Lines (NYSE:DAL): Expect 4Q Non-Fuel Unit Costs to Be Flat-2% Higher YoY。

Delta Air Lines (NYSE:DAL): 3Q Domestic Passenger Revenue Rose 6% Vs Year-Ago on 11% More Capacity。

Delta Air Lines (NYSE:DAL) Adjusts FY View To Adj EPS $6.00-Adj EPS $6.25。

Delta Air Lines (NYSE:DAL) Q3 Adj. EPS $2.03 Vs. $1.51 a Year Ago, Beats the FactSet Consensus of $1.95。

Delta Air Lines (NYSE:DAL) reported fiscal Q3 adjusted earnings Thursday of $2.03 per diluted share, up from $1.51 a year earlier. Analysts polled by Capital IQ expected $1.95. Revenue for the quarter ended Sept. 30 was $15.49 billion compared with $13.98 billion a year earlier. Analysts surveyed by Capital IQ estimated $15.13 billion. For fiscal Q4, the company estimated $1.05 to $1.30 in EPS and 9% to 12% in revenue growth. Analysts polled by Capital IQ estimate adjusted EPS of $1.09 on revenue of $14.09 billion. For the full year, Delta Air Lines said it expects $6.00 to $6.25 in EPS and up to 20% in revenue growth. That compared with a prior estimate for EPS of $6 to $7. Analysts surveyed by Capital IQ forecast $6.01 in adjusted EPS on revenue of $57.5 billion.