Delta Air Lines
stock is on a record streak, dating back to before Memorial Day weekend. Investors are warming to the idea of a hot summer for air travel.
The shares rose a 12th consecutive day Monday, its longest ever winning streak, according to Dow Jones Market Data. The stock is up 15% over that period.
The streak began on the Thursday before Memorial Day weekend, which proved to be a bumper few days for air travel. Close to 9.8 million passed through U.S. airport checkpoints over the four-day weekend, Friday May 26 through Monday May 29, the Transportation Security Administration said. That beat 2019 levels by 300,000 people.
Memorial Day weekend is seen as the unofficial start of the busy summer travel season. Concerns over whether strong travel demand can last have been at the forefront of investors’ minds when it comes to airline stocks. But the holiday weekend set the tone for what looks to be a good summer for U.S. airlines.
Investors certainly seem to be coming round to that idea.
American Airlines
(ticker: AAL) has actually outperformed Delta (DAL) since the Thursday before Memorial Day–rising 16%, even though American’s longest streak in that time is its current five-day one.
United Airlines
(UAL), also on a five-day winning streak, has climbed 10% over the same period.
Delta stock edged higher ahead of the open Tuesday, keeping it on track to extend its consecutive daily gains to 13 sessions. Beyond that, the airline’s analyst day later this month could provide the next move higher for the stock.
Wolfe Research analyst Scott Group raised his price target on the shares to $43 from $38, and said he expected positive news from the event. “We expect an upbeat message in the current goldilocks backdrop or strong spring/summer demand, falling oil prices and continued industry capacity cuts,” he said in a note Friday.
He also thinks Delta could raise its full-year earnings per share guidance–currently at $5 to $6–due to lower fuel prices and durable revenue per available seat mile trends.
Delta’s winning streak will eventually end but more positive catalysts are on the radar.
Write to Callum Keown at [email protected]
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