#4: Delta Air Lines (DAL)
The story of Delta Air Lines (DAL) is a story of one company’s success, but also very much a story of the entire airline industry bouncing back after some rough years for the sector.
After American Airlines (AAMRQ) declared bankruptcy in 2011, it merged this year with US Airways (LCC) to form the largest carrier in the industry. That had many investors optimistic about the lack of competition and the likelihood of higher fares and efficiency — something flyers may not like, but Wall Street does. All stocks in this sector got a tailwind as a result, but as one of the better-run airlines Delta benefited most.
In fiscal 2013, it could see four times the profits it saw in 2010 if projections hold. The company even instituted a dividend in the last year — a rare feat for any stock in the airline sector. New money probably can’t expect the same return Delta shares have already delivered in 2013, but a cyclical recovery could help boost overall air traffic and thus DAL profits in 2014.