DAL Stock: Why It Decreased Today

By Amit Chowdhry ● Oct 13, 2021
  • The stock price of Delta Air Lines, Inc. (NYSE: DAL) fell by over 5% today. This is why it happened.

The stock price of Delta Air Lines, Inc. (NYSE: DAL) fell by over 5% today. Even though Delta had reported a quarterly profit and better-than-expected revenue for the third quarter, the company warned that more expensive fuel is going to pressure the bottom line in late 2021 despite improvements in travel demand.

“At present time, we’re expecting a modest loss in the fourth quarter,” said Delta Air Lines CEO Ed Bastian on a quarterly call with analysts via CNBC.

Delta Air Lines is expecting the costs before fuel expenses to increase 6% to 8% in the fourth quarter and flying is ramping up.

Delta Air Lines said that they would fly 80% of its 2019 capacity, up from 71% compared to the most recent quarter. Delta is expecting fuel prices to increase to $2.25 to $2.40 compared to the average $1.97 a gallon in the third quarter.

Delta Air Lines is expecting revenue to continue to recover over the last 3 months of the year to a little bit under three-quarters of the $11.4 billion brought in during the same quarter in 2019.

The company acknowledged customers are willing to pay for premium seats. And Delta noted that the percentage of customers paying for those types of seats was higher than in September 2019.

The company’s third-quarter profit of $1.2 billion – which was down 19% from 2019 – was its second profit since the pandemic but the first one without federal aid. Delta received billions of dollars in federal assistance to keep them humming during the pandemic. The revenue of $9.15 billion topped analyst expectations of $8.4 billion.

Disclaimer: This content is intended for informational purposes. Before making any investment, you should do your own analysis.