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Investing.com- Analysts at UBS raised their price targets for Delta Air Lines Inc (NYSE:), citing revenue per available seat mile (RASM) growth and revised earnings estimates for 2025 and 2026.
UBS raised its price target to $90 from $88 and has a “Buy” rating on the stock.
Delta’s strong fourth quarter 2024 results exceeded market expectations, with sequential RASM growth accelerating across all regions, led by Asia-Pacific and Atlantic.
UBS highlighted Delta’s diverse network and focus on premium travel as key factors behind its success. Premiums rose 8% in the fourth quarter, outpacing growth of 2%, reflecting continued strength in the premium segment.
For 2025, Delta management has guided earnings per share (EPS) to at least $7.35. UBS expects a change to this guidance, offering $7.73 in EPS for the year.
Analysts believe that cabin revenue may improve further as the year progresses, compared to the year-over-year in the second half. Cost control is also still a good thing, with CASM-ex (cost per available seat mile, excluding fuel) expected to measure up with success.
UBS maintains its strong position on Delta, emphasizing that the airline is well-positioned to take advantage of strong air travel demand and priority routes. With a positive revenue outlook and strategic cost management, Delta is set for steady earnings growth, which supports a higher price target, analysts said.
