When the Iran War started, and jet fuel prices rose, the airline stocks sold off. But now that the war is heading towards an end, and jet fuel prices are coming down, the airline stocks have rebounded and are back to new highs. Put Delta Air Lines Inc. (DAL) on your short list of buys, writes Tracey Ryniec, senior stock strategist at Zacks Investment Research.
Some transportation stocks are still hidden gems even as they rally. And few investors are paying attention to them.
Delta Air Lines Inc. (DAL)
Delta is one of the premier airlines in the US. Thanks to the Iran War, and the surge in jet fuel prices, Delta is expected to see earnings fall 5.2% this year even as consumer demand remains strong. But in 2027, analysts expect Delta to see earnings rebound by 36.8%.
Shares of Delta have recovered from the Iran War sell-off and were recently up 30% year-to-date. In fact, the stock hit new five-year highs.
But Delta is still cheap. It trades with a forward price-to-earnings (P/E) ratio of 15.7.
