Investing.com–UBS analysts raised their price target for Delta Air Lines Inc (NYSE:), citing robust growth in revenue per available seat mile (RASM) and improving earnings estimates for 2025 and 2026.
UBS raised its target to $90 from $88 and maintains a “Buy” rating on the stock.
Delta’s strong fourth quarter 2024 results exceeded market expectations, with sequential RASM growth accelerating across all regions, led by Asia Pacific and Atlantic.
UBS highlighted Delta’s diverse network and its focus on premium travel as key factors in its outperformance. Premium sales grew 8% in the fourth quarter, outpacing 2% growth in the main cabin, indicating continued strength in higher-margin segments.
For 2025, Delta management has guided earnings per share (EPS) to at least $7.35. UBS expects this guidance to rise, projecting EPS of $7.73 for the year.
Analysts believe core cabin revenue could improve further as the year progresses, given easier year-over-year comparisons in the second half. Cost management also remains a positive factor, with CASM-ex (cost per available seat mile, excluding fuel) expected to be moderate thanks to efficiency gains.
UBS maintains its bullish stance on Delta, emphasizing that the airline is well positioned to capitalize on strong air travel demand and premium trends. With a favorable revenue outlook and disciplined cost management, Delta is expected to see sustained earnings growth, supporting the higher price target, analysts say.
