Delta Air Lines expects the revenue to grow further in 2020

Delta
Air Lines of the United States of America announced its forecast for revenue in
the upcoming year on Thursday. According to the estimate, the airline is expecting
the revenue to continue growing in 2020. The company cited a sharp increase in
consumer spending to be the reason for the upbeat expectation.

Following
the forecast, Delta’s stock was seen trading 4% higher on Thursday morning. The
airline has performed fairly well in the stock market in 2019 so far. Having
started the year at $50, it printed a year to date high of around $63 in July. The
stock, however, is currently trading at $56.73. As of Friday, Delta Air Lines
has a market cap of $36.69 billion and a price to earnings ratio of 7.95.

Delta
Expects The Revenue To Note 4% to 6% Growth In 2020

The
airline forecasts its revenue to note 4% to even 6% growth in the upcoming year
and hit the $49 billion mark. In terms of earnings per share, the company
expected $6.75 to $7.75. Analysts, on the other hand, have highlighted the
forecast for Delta’s earnings per share in 2020 at $7.03.

Over
the years, Delta
has earned the reputation of one of the most profitable airlines in the
United States. Announcing better than expected sales in business class seats,
the company expressed its plans of extending its support to further improve the
sales of these seats. As per the executives, focusing on higher sales of
business class seats is crucial to protect the airline against a potential
downturn.

The
airline also added that the revenue from its business class seats is expanding
at a rate that is double the rate at which its overall revenue is growing. By
the end of 2019, revenue from the premium-class is expecting to hit the $15
billion mark. Delta’s credit card business that saw the company partner with
American Express, has shown remarkable growth in 2019 with the revenue expected
to reach $4 billion by the end of the year. In 2020, the company expects this
segment to generate $4.4 billion in revenue.

Delta’s
Fleet Doesn’t Rely On Boeing 737 Max

Delta
Airline’s fleet doesn’t
have the Boeing 737 Max. Since it doesn’t rely on it, the grounding of 737
Max has had no effect on Delta’s overall performance and operations.

In
Thursday’s announcement, the company also highlighted that it is in constant
contact with foreign airlines and is exploring the prospects of partnerships.
Delta has recently partnered with LATAM (the largest Latin-American airline.
The airline, however, didn’t comment on how the business may be affected
following the new tariffs applied on the Airbus jets.