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The Zacks Consensus Estimate for the March-end quarter’s bottom line is currently pegged at a loss of $1.33, much wider than a loss of 56 cents stated 90 days ago. The unfavorable revision mainly occurred from the upsurge in oil price, fueled by supply concerns due to the Russia-Ukraine war.
Against this backdrop, let’s discuss the factors that are expected to have impacted Delta’s performance in the March-end quarter.
We expect Delta’s bottom-line performance in the to-be-reported quarter to have been dented by high fuel costs. Evidently, the oil price has been moving north, having escalated 33% in first-quarter 2022, led by the Russia-Ukraine war. The Zacks Consensus Estimate for average fuel price per gallon (adjusted) is currently pegged at $2.63, indicating a 25.2% sequential increase. Delta anticipates an adjusted fuel price of $2.80 per gallon.
Management expects the capacity in the March-end quarter to be 83% of first-quarter 2019 actuals. The Zacks Consensus Estimate for first-quarter available seat miles (a measure of capacity) is currently pegged at 52,095 miles, indicating a 0.7% rise from the figure reported in the fourth quarter of 2021. Also, Delta expects first-quarter 2022 non-fuel unit costs to increase 15% from the first-quarter 2019 reported level.
However, despite high fuel costs, passenger revenues are likely to have been strong, owing to upbeat air-travel demand. The Zacks Consensus Estimate for first-quarter passenger revenues is pegged at $7,002 million, indicating a jump of 154.8% from the first-quarter 2021 reported level.
What Does the Zacks Model Unveil?
The proven Zacks model does not predict a bottom-line outperformance for Delta this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings surprise, which is not the case here. You can see the complete list of today’s Zacks #1 Rank stocks here.
Earnings ESP: Delta has an Earnings ESP of -3.40% as the Most Accurate Estimate is pegged at a loss of $1.37, while the Zacks Consensus Estimate is pinned at a loss of $1.33. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Delta carries a Zacks Rank #3, currently.
Highlights of Q4
Delta's earnings (excluding 86 cents from non-recurring items) of 22 cents per share outpaced the Zacks Consensus Estimate of 15 cents. Results came against the year-ago quarter’s loss of $2.53 per share. Strong holiday travel demand and favorable pricing aided the December-end quarter’s results.
Delta’s revenues were $9,470 million, which not only beat the Zacks Consensus Estimate of $9,232.1 million but also soared in excess of 100% from the year-ago figure as people resorted to air travel during the holidays.
Stocks to Consider
Investors interested in the broader Transportation sector may consider Landstar System (LSTR - Free Report) and Knight-Swift Transportation Holdings (KNX - Free Report) . These companies possess the right combination of elements to beat on earnings in this reporting cycle.
Landstar System has an Earnings ESP of +8.72% and is a Zacks #3 Ranked stock at present. LSTR will release first-quarter 2022 results on Apr 20.
Landstar’s first-quarter results are expected to reflect gains from an improved freight scenario in the United States. Higher truck rates, owing to tight truck capacity, are anticipated to have aided the March-quarter performance.
Knight-Swifthas an Earnings ESP of +2.80% and is currently a #3 Ranked player. KNX will release first-quarter 2022 results on Apr 20.
Knight-Swift’s first-quarter results are expected to be aided by an improved freight scenario in the United States. Revenues at the Logistics segment are likely to have been strong due to an increase in load count and revenue per load.
Image: Shutterstock
Delta Air (DAL) to Report Q1 Earnings: What's in Store?
Delta Air Lines (DAL - Free Report) is scheduled to report first-quarter 2022 results on Apr 13, before market open.
DAL’s bottom line outpaced the Zacks Consensus Estimate in three of the last four quarters and missed in the other one, the average beat being 38.88%.
Delta Air Lines, Inc. Price and EPS Surprise
Delta Air Lines, Inc. price-eps-surprise | Delta Air Lines, Inc. Quote
The Zacks Consensus Estimate for the March-end quarter’s bottom line is currently pegged at a loss of $1.33, much wider than a loss of 56 cents stated 90 days ago. The unfavorable revision mainly occurred from the upsurge in oil price, fueled by supply concerns due to the Russia-Ukraine war.
Against this backdrop, let’s discuss the factors that are expected to have impacted Delta’s performance in the March-end quarter.
We expect Delta’s bottom-line performance in the to-be-reported quarter to have been dented by high fuel costs. Evidently, the oil price has been moving north, having escalated 33% in first-quarter 2022, led by the Russia-Ukraine war. The Zacks Consensus Estimate for average fuel price per gallon (adjusted) is currently pegged at $2.63, indicating a 25.2% sequential increase. Delta anticipates an adjusted fuel price of $2.80 per gallon.
Management expects the capacity in the March-end quarter to be 83% of first-quarter 2019 actuals. The Zacks Consensus Estimate for first-quarter available seat miles (a measure of capacity) is currently pegged at 52,095 miles, indicating a 0.7% rise from the figure reported in the fourth quarter of 2021. Also, Delta expects first-quarter 2022 non-fuel unit costs to increase 15% from the first-quarter 2019 reported level.
However, despite high fuel costs, passenger revenues are likely to have been strong, owing to upbeat air-travel demand. The Zacks Consensus Estimate for first-quarter passenger revenues is pegged at $7,002 million, indicating a jump of 154.8% from the first-quarter 2021 reported level.
What Does the Zacks Model Unveil?
The proven Zacks model does not predict a bottom-line outperformance for Delta this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings surprise, which is not the case here. You can see the complete list of today’s Zacks #1 Rank stocks here.
Earnings ESP: Delta has an Earnings ESP of -3.40% as the Most Accurate Estimate is pegged at a loss of $1.37, while the Zacks Consensus Estimate is pinned at a loss of $1.33. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Delta carries a Zacks Rank #3, currently.
Highlights of Q4
Delta's earnings (excluding 86 cents from non-recurring items) of 22 cents per share outpaced the Zacks Consensus Estimate of 15 cents. Results came against the year-ago quarter’s loss of $2.53 per share. Strong holiday travel demand and favorable pricing aided the December-end quarter’s results.
Delta’s revenues were $9,470 million, which not only beat the Zacks Consensus Estimate of $9,232.1 million but also soared in excess of 100% from the year-ago figure as people resorted to air travel during the holidays.
Stocks to Consider
Investors interested in the broader Transportation sector may consider Landstar System (LSTR - Free Report) and Knight-Swift Transportation Holdings (KNX - Free Report) . These companies possess the right combination of elements to beat on earnings in this reporting cycle.
Landstar System has an Earnings ESP of +8.72% and is a Zacks #3 Ranked stock at present. LSTR will release first-quarter 2022 results on Apr 20.
Landstar’s first-quarter results are expected to reflect gains from an improved freight scenario in the United States. Higher truck rates, owing to tight truck capacity, are anticipated to have aided the March-quarter performance.
Knight-Swifthas an Earnings ESP of +2.80% and is currently a #3 Ranked player. KNX will release first-quarter 2022 results on Apr 20.
Knight-Swift’s first-quarter results are expected to be aided by an improved freight scenario in the United States. Revenues at the Logistics segment are likely to have been strong due to an increase in load count and revenue per load.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.