Delta Air Lines, Inc. (DAL) Stock Dips on Lowered Forecast

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Delta Air Lines, Inc. (NYSE:DAL) stock was down on Monday following lowered forecasts for the company’s upcoming quarter.

 Delta Air Lines, Inc., DALDelta Air Lines, Inc. says that it now expects passenger revenue per available seat mile to be flat during its current quarter. This is a drop from its previous guidance, which had passenger revenue per available seat mile ranging from 0% to 2% when compared to the same time last year.

Delta Air Lines, Inc.’s decision to reduce its passenger revenue per available seat mile forecast comes as fares take longer to bounce back than expected. The company is also dealing with fuel costs being up by $20 per barrel from the same time last year. It also faces higher costs from new pilot contracts.

Delta Air Lines, Inc. didn’t just lower its forecast for passenger revenue per available seat mile. The company also said that its operating profit margin will be down for its current quarter. It now expects operating profit margin to range from 10% to 11%. DAL’s previous guidance for operating profit margin was 11% to 13%, reports Bloomberg.

“Margins under pressure in 1H17, but we are focused on returning to margin expansion in the back half of the year as improving RASM trajectory catches up to cost increases,” Delta Air Lines, Inc. told Seeking Alpha about its margins.

Delta Air Lines, Inc. announced its lowered forecast at the Raymond James 38th Annual Institutional Investors Conference. You can find the slides from its presentation at the conference by following this link.

DAL stock was down 3% as of Monday afternoon.


Article printed from InvestorPlace Media, https://investorplace.com/2017/03/delta-air-lines-inc-forecast-dal/.

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