Delta Air Lines, Inc. (DAL): A Bull Case Theory

Core Thesis - Delta Air Lines, Inc. (DAL) is experiencing strong operational resilience and growth potential, supported by record revenue and robust earnings [2][5][6] Financial Performance - Delta reported record revenue of $15.5 billion for the June quarter, a 1% increase year-over-year, driven by a 4% capacity increase [2] - Adjusted EPS was $2.10, slightly above analyst estimates, while GAAP EPS was $3.27, indicating strong margins [2] - Operating margins were solid at 13.2% on a non-GAAP basis, despite challenges from fuel and labor costs [3] Guidance and Projections - The company restored full-year EPS guidance to a range of $5.25–$6.25 and raised free cash flow expectations to $3–$4 billion [3] - For Q3, revenue growth is projected at 0–4% with EPS guidance of $1.25–$1.75, indicating steady operational momentum [3] Market Reaction - Following the strong results, DAL shares climbed 10–12%, making it one of the top performers on the S&P 500 [4] - The stock's breakout above $51 has created near-term trading opportunities, with potential upside toward $60 if trading volume remains supportive [4] Long-term Outlook - For long-term investors, pullbacks to $45–$47 offer an attractive free cash flow yield near 8% and a forward dividend yield exceeding 2% [4] - Delta's focus on premium products and operational efficiency supports sustained upside in the stock [5][6]