Why Delta Air Lines Shares Are Diving Today
Portfolio Pulse from Akanksha Bakshi
Delta Air Lines Inc (DAL) shares dropped approximately 5% following its Q4 and fiscal 2023 results. Despite beating revenue consensus with $14.22 billion and adjusted EPS of $1.28, the company saw a decrease in adjusted operating income and margin, and a decline in cargo revenue and total revenue per available seat mile. Passenger load factor slightly decreased, while adjusted operating expenses and non-fuel costs rose. Delta reported strong liquidity and a reduction in adjusted net debt. The company also announced a purchase agreement with Airbus SE (EADSY) for twenty A350-1000s and a service agreement for Trent XWB-97 engines. DAL provided a positive outlook for 2024 with expected earnings growth and free cash flow generation.
January 12, 2024 | 2:34 pm
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POSITIVE IMPACT
Airbus SE entered into an agreement with Delta Air Lines for the sale of twenty A350-1000s, with options for twenty more, and a service agreement for engines, indicating a strong business relationship and potential future revenue.
The agreement with Delta Air Lines for aircraft and services is likely to be seen as a positive development for Airbus, indicating future revenue streams and strengthening its order book.
CONFIDENCE 85
IMPORTANCE 70
RELEVANCE 80
NEUTRAL IMPACT
Delta Air Lines reported higher than expected Q4 revenue and adjusted EPS, but saw a decrease in adjusted operating income and margin. The company announced a positive outlook for 2024 and a significant purchase agreement with Airbus.
Despite the short-term negative reaction to the mixed financial results, the positive outlook for 2024 and the strategic purchase agreement with Airbus could provide stability and growth prospects, potentially offsetting the short-term impact.
CONFIDENCE 90
IMPORTANCE 85
RELEVANCE 100