Summary
- DAL is one of the best airlines out there and will come out on top when this is over.
- The company has enough liquidity and there is an implied government handout on the way.
- With pent-up demand and lower fuel costs in the future, the future looks bright for Delta.
Thesis Summary
Delta Airlines Inc, (DAL) is by many measures one of the best airlines in the U.S. The company is more than well equipped to weather the storm and could likely receive help from the government. With early signs that the worst might be behind us, both in terms of virus and market, this may be the right time to open a position.
Company Overview
Delta Airlines has been one of the best performing players in the industry over the last few years. They have shown operational excellence and strong growth compared to some of their peers. The last three years, especially, have been outstanding.
Source: Annual Report 2019
Three-year CAGR has been about 6%. Furthermore, the company has increased revenues at the same time it has increased profitability. 2019 saw an EBITDA growth of 17.24% thanks to other things to lower aircraft and fuel costs.
