4 Airline Stocks Wall Street Predicts Will Climb By 25% Or More

white passenger plane in the sky during daytime

Source: Unsplash 

The airlines’ industry was one of the hardest-hit industries last year, as lockdowns and travel bans halted airline operations worldwide entirely for several months. However, with 69% of the adult population vaccinated with at least one dose, travel restrictions are being eased, and the demand for airline services is rebounding.

The global airlines market is projected to grow at a 12.7% CAGR over the next five years to reach $744 billion by 2026. According to the International Air Transport Association (IATA), air traffic in the Americas region is expected to witness solid growth over the next 20 years. Pent-up demand and increasing consumer spending are driving a gradual return in leisure and commercial travel.

Given this backdrop, Wall Street analysts expect airline stocks Delta Air Lines, Inc. (DAL), United Airlines Holdings, Inc. (UAL), Alaska Air Group, Inc. (ALK), and SkyWest, Inc. (SKYW) to gain altitude with a 25%-plus rally in the coming months.

Delta Air Lines, Inc. 

DAL provides scheduled air transportation for passengers and cargo across a global network of more than 300 destinations in over 50 countries. The Atlanta, Ga.-company operates through two segments, Airline and Refinery.

On May 3, DAL and Sabre formulated a transformative global distribution agreement to drive change in the travel industry through commercial and technological innovation, while enabling DAL to continue to extend its reach with Sabre’s valuable network of global travel buyers.

DAL’s total operating revenue increased 385.4% year-over-year to $7.13 billion in its fiscal second quarter, ended June 30. Its operating income grew 116.9% from its year-ago value to $816 million, while its net income improved 111.4% year-over-year to $652 million. The company’s EPS increased 111.3% year-over-year to $1.02.

Analysts expect DAL’s revenues to increase 162.1% year-over-year to $8.16 billion in the current quarter, ending September 2021. A  $0.27  consensus EPS estimate for the current quarter indicates a 108.2% rise from the same period last year. Shares of DAL have gained 50.9% over the past year.

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