Critical Contrast: Delta Air Lines (NYSE:DAL) & Its Competitors

Delta Air Lines (NYSE: DAL) is one of 31 public companies in the “Airlines” industry, but how does it contrast to its rivals? We will compare Delta Air Lines to similar businesses based on the strength of its analyst recommendations, institutional ownership, valuation, profitability, dividends, earnings and risk.

Earnings and Valuation

This table compares Delta Air Lines and its rivals gross revenue, earnings per share and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Delta Air Lines $40.46 billion $7.45 billion 10.15
Delta Air Lines Competitors $8.62 billion $1.61 billion -84.43

Delta Air Lines has higher revenue and earnings than its rivals. Delta Air Lines is trading at a higher price-to-earnings ratio than its rivals, indicating that it is currently more expensive than other companies in its industry.

Insider and Institutional Ownership

87.6% of Delta Air Lines shares are held by institutional investors. Comparatively, 78.7% of shares of all “Airlines” companies are held by institutional investors. 0.4% of Delta Air Lines shares are held by insiders. Comparatively, 5.5% of shares of all “Airlines” companies are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Delta Air Lines and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Delta Air Lines 8.97% 26.50% 6.77%
Delta Air Lines Competitors 3.89% 11.13% 3.66%

Risk and Volatility

Delta Air Lines has a beta of 1.24, indicating that its share price is 24% more volatile than the S&P 500. Comparatively, Delta Air Lines’ rivals have a beta of 1.20, indicating that their average share price is 20% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations and price targets for Delta Air Lines and its rivals, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Delta Air Lines 0 0 15 0 3.00
Delta Air Lines Competitors 309 1070 2176 96 2.56

Delta Air Lines currently has a consensus target price of $64.62, suggesting a potential upside of 27.80%. As a group, “Airlines” companies have a potential downside of 9.66%. Given Delta Air Lines’ stronger consensus rating and higher possible upside, equities research analysts plainly believe Delta Air Lines is more favorable than its rivals.

Dividends

Delta Air Lines pays an annual dividend of $1.22 per share and has a dividend yield of 2.4%. Delta Air Lines pays out 24.5% of its earnings in the form of a dividend. As a group, “Airlines” companies pay a dividend yield of 2.0% and pay out 32.5% of their earnings in the form of a dividend. Delta Air Lines has increased its dividend for 3 consecutive years. Delta Air Lines is clearly a better dividend stock than its rivals, given its higher yield and lower payout ratio.

Summary

Delta Air Lines beats its rivals on 13 of the 15 factors compared.

About Delta Air Lines

Delta Air Lines, Inc. provides scheduled air transportation for passengers and cargo throughout the United States and across the world. The Company’s segments include Airline and Refinery. The Company’s route network is centered around a system of hub, international gateway and airports that the Company operates in Amsterdam, Atlanta, Boston, Detroit, London-Heathrow, Los Angeles, Minneapolis-St. Paul, New York-LaGuardia, New York- John F Kennedy International Airport, Paris-Charles de Gaulle, Salt Lake City, Seattle and Tokyo-Narita. Each of these operations includes flights that gather and distribute traffic from markets in the geographic region surrounding the hub or gateway to domestic and international cities and to other hubs or gateways. The Company’s route network includes its international joint ventures, its alliances with other foreign airlines, its membership in SkyTeam and agreements with multiple domestic regional carriers that operate as Delta Connection.

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