Investors didn’t like Delta Air Lines (NYSE:DAL) cutting its Q4 2018 unit revenue growth to 3% from 3.5%, a number it provided investors only four weeks earlier. The news sent DAL stock down 8.9% Jan. 3, closing at $45.61 — its fourth time under $50 in the past year. Since then, DAL hasn’t managed to make a strong recovery.

Investors looking for a deal are probably asking themselves whether the significant drop provides a buying opportunity or is there more pain in store for DAL stock over the next few days and weeks?

Is it a buy? Is it a sell? I’ll take a look at both sides of the argument.

DAL Stock Is a Buy

While airline stocks as a whole have been weaker over the past year compared to previous years, companies like Delta are still making decent profits.

Delta will deliver its ninth consecutive year of profitability and expects the fourth quarter to bring as much as $1.30 per share to the bottom line, suggesting that the latest forecast cut could be a blip rather than a sign of impending doom.

In hindsight, you’d have made a lot of money over the past 52 weeks by buying DAL stock below $50 and selling it above $60.

DAL stock traded above $60 over the past year on three occasions: January, September and November. It has traded below $50 on four occasions: February, June, October and January 2019.

Source: Yahoo Finance

Putting reality aside — trading like this would cause the gains to be taxed as regular income rather than capital gains — an investor would have made 35% on an annualized basis on the first two buys and 138% on the last buy and sell in October and November with the gains on the final buy to be determined.

Uncertainty in the airline industry mixed in with the return of volatility in the markets has made Delta stock a winning trade over the past year.

What a buy-and-hold investor can do with the past year’s trading information is use it to figure out an entry point that will make you money over the long haul.

With oil prices appearing mellowed in recent months and the economy relatively healthy, if you’re a fan of Delta, I don’t see why you wouldn’t consider buying its stock under $50.

Delta Stock Is a Sell

There are two reasons why investors should be cautious of holding DAL stock at this point in the cycle.

The first is that 2019 does not look like it’s going to be a good one for the markets. The New York Times spoke to James Stack recently, the man who predicted in January 2018 that the markets would crank up the volatility over the next year and it wouldn’t end well.

It didn’t. Now Stack believes that more pain is in store.

“He believes that the worst isn’t over and that the Dow and S&P 500 will soon be down 20 percent from their peaks, retreating into a bear market. (The Nasdaq Composite and the Wilshire 2000 index of small-cap stocks are already there.),” James Stewart wrote Jan. 4. “And that was before a revenue warning from Apple sent markets into another steep fall on Thursday.”

The second reason is that airline stocks continue to be in the jaws of a bear market — airline stocks have a total return over the past year of negative 19.5%, more than double the losses for the S&P 500 — suggesting now is not the time to fight the trend.

The Bottom Line on DAL Stock

I’m leaning toward 2019 being a bad year on the markets because we’re going to learn by the end of the second quarter that a recession is coming at some point in 2020, putting a severe damper on investor enthusiasm.

That said, it’s hard to imagine Delta stock trading below $40 in 2019, making anything below $45 reasonably attractive to those willing to accept the risk.

Only aggressive investors need apply.

As of this writing, Will Ashworth did not hold a position in any of the aforementioned securities.