{"id":28435,"date":"2023-06-27T23:50:47","date_gmt":"2023-06-28T03:50:47","guid":{"rendered":"https:\/\/ifintechworld.com\/investing\/delta-air-lines-says-pent-up-demand-for-air-travel-is-continuing-as-it-raises-2023-guidance\/"},"modified":"2023-06-27T23:50:49","modified_gmt":"2023-06-28T03:50:49","slug":"delta-air-lines-says-pent-up-demand-for-air-travel-is-continuing-as-it-raises-2023-guidance","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=28435","title":{"rendered":"Delta Air Lines says pent-up demand for air travel is continuing as it raises 2023 guidance"},"content":{"rendered":"
\n

Delta Air Lines Inc.\u2019s stock rose 3% Tuesday to put it on track for a 14-month high after the carrier raised guidance for 2023 and backed 2024 targets at an investor day.<\/p>\n

Executives described a constructive industry backdrop in a slide presentation with structural demand tailwinds coming out of the COVID-19 pandemic and multi-year supply constraints. <\/p>\n

\n

The pent-up demand for air travel that has built since 2020 has not yet been satisfied, employment trends are strong and the shift away from goods and toward services continues. <\/p>\n

Supply constraints are real, \u201cbut the demand tailwinds are also real and they\u2019re also substantial,\u201d Chief Executive Ed Bastian told analysts, according to a FactSet transcript. <\/p>\n

See also: <\/strong>Fourth of July travel will break records, AAA says<\/p>\n

Delta cited Federal Reserve data showing leisure travel is the highest priority purchase for high-income households. High-income travelers accounted for 75% of spending on air travel in 2021, that data showed.<\/p>\n

Delta
\n DAL,
\n +6.84%<\/bg-quote>
\n is now expecting 2023 per-share earnings to come in at the top of its range of $5 to $6 and for free cash flow to total $3 billion, up from $2 billion previously. <\/p>\n

The airline is expecting a return on invested capital of more than 13%, compared with earlier guidance of low double-digit growth. It expects its operating margin to come in at the high end of its 10% to 12% guidance range. <\/p>\n

For 2024, Delta is still expecting EPS of more than $7, free cash flow of more than $4 billion, an operating margin of 13% to 15% and ROIC in the mid-teens. <\/p>\n

The company also raised its revenue outlook for the June quarter to a rise of 17% to 18% from previous guidance of 15% to 17%. For all of 2023, it expects revenue to climb 17% to 20%, compared with earlier guidance of 15% to 20%. <\/p>\n

The company is expecting second-quarter and full-year capacity to be up 17% from the year-earlier period. For 2024, it expects capacity to be up in the mid-single-digits.<\/p>\n

It expects non-fuel costs per average seat mile, or CASM, to range from 1% to 3% in the second quarter and to be flat for the year. For 2024, it expects non-fuel CASM to fall by low single digits.<\/p>\n

Other items highlighted at the presentation, which will include a TechOps facility tour and panels on delivering operational reliability, customer personalization, and ESG, according to Raymond James, were an update on plans for its fleet.<\/p>\n

Delta is retiring Boeing 757-200 aircraft that have 199 seats and replacing them with Airbus 321neo aircraft with 194 seats. It\u2019s also retiring 767-300ER planes with 215 seats and replacing them with A330-900neo craft with 281 seats. <\/p>\n

The next-generation craft is 15% to 25% more fuel efficient and comes with lower seat costs and more premium seats.<\/p>\n

The stock was up 0.8% premarket and has gained 36% in the year to date, while the US Global JETS ETF
\n JETS,
\n +4.41%<\/bg-quote>
\n has gained 21% and the S&P 500
\n SPX,
\n +1.15%<\/bg-quote>
\n has gained 13%.<\/p>\n

Read also:<\/strong>\u00a0\u2018I\u2019m flying first class most of the time\u2019: 5 travel hacks to beat the summer crowds and high prices<\/p>\n

Related:<\/strong> \u2018Why are clubs so crowded these days?\u2019 Airport lounges have lost their peaceful privilege, are they worth it anymore?<\/p>\n<\/p><\/div>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Delta Air Lines Inc.\u2019s stock rose 3% Tuesday to put it on track for a 14-month high after the carrier raised guidance for 2023 and backed 2024 targets at an investor day. Executives described a constructive industry backdrop in a slide presentation with structural demand tailwinds coming out of the COVID-19 pandemic and multi-year supply […]<\/p>\n","protected":false},"author":1,"featured_media":28436,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"video","meta":{"footnotes":""},"categories":[239],"tags":[83],"class_list":["post-28435","post","type-post","status-publish","format-video","has-post-thumbnail","hentry","category-investing","tag-featured","post_format-post-format-video"],"yoast_head":"\nDelta Air Lines says pent-up demand for air travel is continuing as it raises 2023 guidance | iFintechWorld<\/title>\n<meta name=\"description\" content=\"Delta Air Lines Inc.\u2019s stock rose 3% Tuesday to put it on track for a 14-month high after the carrier raised guidance for 2023 and backed 2024 targets at\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, 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