What Can We Learn From Delta Air Lines Inc. (DAL)’s Valuation Ratios?


Delta Air Lines Inc. (NYSE:DAL) finished Thursday with an addition of $0.74 to close at $32.73, an upside of 2.31 percent. An average of 7,090,080 shares of common stock have been traded in the last five days. There was a fall of -$0.94 in the past week, and it reached a new high 12 times over the past 12 months. The last 20 days have seen an average of 9,405,000 shares traded, while the 50-day average volume stands at 8,894,802.

DAL stock has decreased by -5.43% in the last month. The company shares reached their 1-month lowest point of $31.82 on 12/29/22. With the stock rallying to its 52-week high on 04/21/22, shares of the company touched a low of $27.20 and a high of $46.27 in 52 weeks. It has reached a new high 11 times so far this year and lost -16.25% or -$6.35 in price. In spite of this, the price is down -29.26% from the 52-week high.

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Insider Transactions

DAL stock investors should be aware that Delta Air Lines Inc. (DAL) stock had its last reported insider trading activity 63 days ago on Oct 28. In this transaction, the insider spent $68,380. Chief Executive Officer, Bastian Edward H, disposed of 47,500 shares at a price of $31.58 on Aug 31. The insider now owns more than $1,499,908 worth of shares. Prior to that, EVP & Chief People Officer Smith Joanne D went on to Sale 7,704 shares at $41.48 each on May 31. An amount of $319,562 was transacted.

Valuation Metrics

Delta Air Lines Inc. (DAL) has a trailing price-to-earnings (P/E) ratio of 287.11. The stock’s beta is 1.21. Other valuation ratios to consider include the trailing price-to-sales (P/S) ratio at 0.45, the price-to-book (PB) ratio at 4.55, and the price-to-cash flow ratio at 5.51.

Financial Health

The quick ratio of Delta Air Lines Inc. for the three months ended September 29 was 0.50, and the current ratio was 0.60, indicating that the company is not able to meet its debt obligations. Further, the company has a long term debt to equity ratio of 4.62 and a total debt to equity ratio of 5.06 for the quarter ending September 29. Its gross profit as reported stood at $7.4 billion compared to revenue of $29.9 billion.

For investors, determining the potential profitability of the investment also depends on the performance of the company’s management. In the past 12 months, Delta Air Lines Inc.’s return on assets was 0.10%.

Earnings Surprise

For the three-month period that ended September 29, Delta Air Lines Inc. had $1.34 billion in cash and short-term investments compared to $21.2 billion in total debt. In the quarter under review, the net income was up than the previous quarter. The company posted a net income of $695.0 million in the quarter, while revenues were grew 6.19%. The analyst consensus anticipated Delta Air Lines Inc.’s latest quarter earnings to come in at $1.53 per share, but it turned out to be $1.51, a -1.30% surprise. For the quarter, EBITDA amounted to $1.46 billion. Shareholders own equity worth $641.19 million.

Technical Picture

From a technical analysis perspective, let’s take a brief look at Delta Air Lines Inc. (DAL) price momentum. RSI 9-day as of the close on 29 December was 43.38%, suggesting the stock is Neutral, with historical volatility in this time frame at 26.37%.

As of today, DAL’s price is $32.74 -2.79% or -$0.94 from its 5-day moving average. DAL is currently trading -7.46% lower than its 20-day SMA and -3.02% lower than its 100-day SMA. However, the stock’s current price level is +1.74% above the SMA50 and -6.11% below the SMA200.

The stochastic %K and %D were 14.32% and 16.27%, respectively, and the average true range (ATR) was 1.08. With the 14-day stochastic at 23.33% and the average true range at 1.10, the RSI (14) stands at 44.71%. The stock has reached -0.38 on the 9-day MACD Oscillator while the 14-day reading was at -0.73.

What is DAL’s price target for the next 12 months?

Analysts predict a range of price targets between $35.00 and $81.00, with a median target of $45.00. Taking a look at these predictions, the average price target given by analysts for Delta Air Lines Inc. (DAL) stock is $48.41.


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