CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
Our 12-month target of $48, down $1, is 6.5x our 2025 EPS view (started at $7.41; 2024’s raised to $6.51 from $6.49), below the 2018-2019 forward average of 8.5x. We think a discount is merited due to persistent delays in new aircraft deliveries that are expected to last until 2025. Q4 EPS of $1.28 vs. $1.48 beat consensus by $0.12. Shares were down 9% today due to, in our view, a more conservative outlook on its 2024 EPS forecast vs. prior guidance. Q4 revenues were up 11% Y/Y, driven by its int’l segment (+25%), while capacity grew 15% Y/Y. DAL announced its 2024 guidance, with expected earnings of $6-$7/share (vs. the prior outlook of $7/share) and fuel costs in the range of $2.70/g (vs. $2.82/g in 2023). Also, DAL expects FCF in 2024 to be in the range of $3B-$4B (vs. $2B in 2023), which we think is fair given DAL has 40% of its long-haul bookings on hand. For 2024, we think DAL should benefit vs. its legacy peers, given its peer-leading premium offerings and brand recognition. Shares currently yield 1.0%.