After 10% Drop Last Week, Can Delta Air Lines Stock Bounce?

+38.88%
Upside
29.02
Market
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Trefis
DAL: Delta Air Lines logo
DAL
Delta Air Lines

Della Air Lines Inc. stock (NYSE: DAL) is down 10% in the past week, strongly underperforming the S&P 500 which was down 4% over this period. If you look at the change over the last ten days and one month, too, the stock has returned -6.7% and -8.9%, performing roughly as poorly as the broader markets on both occasions. Delta’s most recent Q2 ’22 earnings, saw revenue rising from $7.13 billion in Q2 ’21 to $13.8 billion in Q2 ’22, driven primarily by a $5.6 billion rise in sales from the passenger segment. Rising fuel expenses saw operating costs nearly double over this period, but the company still reported operating income of $1.52 billion, up strongly from $816 million for Q2 ’21. Despite a rise in the effective tax rate and the outstanding share count, the company’s net earnings rose, and EPS came in higher at $1.15, compared to $1.02 in Q2 ’21.

Now, is Delta Air Lines stock set to continue its underperformance or could we expect a bounce back? We believe that there is a strong 69% chance of a rise in DAL stock over the next month (21 trading days) based on our machine learning analysis of trends in the stock price over the last ten years. See our analysis on DAL Stock Chance of Rise. For additional details about the company’s historical returns and comparison to peers, see Delta Air Lines (DAL) Stock Return

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Twenty-One Day: DAL -8.9%, vs. S&P500 -9.2%; Outperformed market

(12% likelihood event; 69% probability of rise over next 21 days)

  • DAL stock lost 8.9% over the last twenty-one trading days (one month), compared to a broader market (S&P500) drop of 9.2%
  • A change of -8.9% or more over twenty-one trading days is a 12% likelihood event, which has occurred 299 times out of 2514 in the last 10 years
  • Of these 299 instances, the stock has seen a positive movement over the next twenty-one trading days on 205 occasions
  • This points to a 69% probability for the stock rising over the next twenty-one trading days

Ten Day: DAL -6.7%, vs. S&P500 -6.5%; Underperformed market

(11% likelihood event; 58% probability of rise over next 10 days)

  • DAL stock lost 6.7% over the last ten trading days (two weeks), compared to a broader market (S&P500) drop of 6.5%
  • A change of -6.7% or more over ten trading days is a 11% likelihood event, which has occurred 273 times out of 2516 in the last 10 years
  • Of these 273 instances, the stock has seen a positive movement over the next ten trading days on 159 occasions
  • This points to a 58% probability for the stock rising over the next ten trading days

Five Day: DAL -10%, vs. S&P500 -4.1%; Underperformed market

(2% likelihood event; 62% probability of rise over next five days)

  • DAL stock lost 10% over a five-day trading period ending 9/22/2022, compared to the broader market (S&P500) which was down 4.1% over this period.
  • A change of -10% or more over five trading days (one week) is a 2% likelihood event, which has occurred 60 times out of 2516 in the last 10 years
  • Of these 60 instances, the stock has seen a positive movement over the next five trading days on 37 occasions
  • This points to a 62% probability for the stock rising over the next five trading days

What if you’re looking for a more balanced portfolio instead? Our high-quality portfolio and multi-strategy portfolio have beaten the market consistently since the end of 2016.

 Returns Sep 2022
MTD [1]
2022
YTD [1]
2017-22
Total [2]
 DAL Return -8% -27% -42%
 S&P 500 Return -7% -23% 63%
 Trefis Multi-Strategy Portfolio -11% -25% 196%

[1] Month-to-date and year-to-date as of 9/23/2022
[2] Cumulative total returns since the end of 2016

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