What are we seeing in the technical analysis of $DAL?📊 In the NYSE:DAL chart, we can observe a classic pattern, an uptrend channel. This type of formation starts with an initial movement that sets the tone for the channel, either bullish or bearish. In this case, it's an uptrend channel that is validated when the price respects the structure at least twice.
📈 Over time, we’ve seen that this channel has held. However, the relevance of the pattern depends on the time frame. For example, a channel on daily, weekly, or monthly charts is more significant than one on a one minute chart, which can quickly be invalidated.
🗝️ Key data about the NYSE:DAL channel
▫️ Start 🟰 August 6, 2024.
▫️ Duration 🟰 102 days, about 3 months.
▫️ Movement 🟰 +75% within the channel.
📅 This week, for the first time, the price broke out of the channel, which could signal a pattern change. Here are three key points to consider
▫️ RSI Relative Strength Index🟰 Shows a bearish divergence on daily timeframes and overbought levels.
▫️ Parabolic SAR Indicator 🟰 It’s very close to the price and could shift from an uptrend to a downtrend.
▫️ Pending Gap 🟰 There's a significant gap between $58 and $60 that hasn't been closed yet.
📊 Key fundamental points In Q3 2024, NYSE:DAL reported
▪️ Total Revenue 🟰 $15.6 billion, a year over year growth of 1.2%.
▪️ Operating Margin 🟰 8.8% vs 12.4% in the same period of 2023.
▪️ Net Margin 🟰 Improved from 7.1% to 8.1%, thanks to financial income of fsetting high costs.
▪️ EPS 🟰 $1.50 slightly below the estimate of $1.5.
▪️ Debt 🟰 Delta has significantly reduced its debt, from $26 billion in 2020 to $14.3 billion in Q3 2024, with a Debt/EBIT ratio of 3.3x, much lower than United Airlines (5.59x). This solid financial management suggests that DAL could restart its share buyback program soon.
📊 Outlook
👥 Passengers 🟰 Global traffic is expected to grow by 7% in 2024, with a compound annual growth rate of 5.57% through 2028.
🛫 Valuation 🟰 According to a DCF model, the target price for DAL is $78.60, implying an upside potential of 20% from current levels.
📉 Although technical indicators suggest a potential short term pullback, DAL’s strong fundamentals, its focus on the premium segment, and improvements in its balance sheet are positive signals for the long term.
