Delta’s Robust Q2 Earnings Report Lifts Airline Peers — Goldman Sachs Hikes Price Target

Delta Air Lines’ strong second-quarter earnings report and the reinstatement of its annual forecast ensured the shares of the company and its peers were among the top S&P 500 gainers on Thursday.

The company’s rival, United Airlines (UAL), emerged as the top gainer in the broader index, with a 14.3% jump, while Delta itself rose 12% and Southwest Airlines gained over 8%. Retail sentiment about all three companies in Stocktwits was in the ‘bullish’ territory.

Delta, the first major U.S. airline to report earnings, issued a new profit forecast for 2025, which came in above Wall Street expectations. In April, Delta, along with a few other U.S. airlines, including American Airlines (AAL) and JetBlue Airways (JBLU), withdrew its annual expectations for the year, as U.S. President Donald Trump’s tariffs initially discouraged Americans from traveling.

Delta CEO Ed Bastian said, “The environment has been stable since resetting to a lower growth rate earlier this year. Overall demand for air travel remains similar to last year, with softness largely contained to the main cabin and particularly during off-peak periods.”

Goldman Sachs raised the price target for Delta stock to $67 from $60 and maintained a ‘Buy’ rating. According to The Fly, the analysts at the brokerage noted that the primary drivers of the stock's outperformance include better-than-feared Q3 revenue projections of up 2% compared to the previous year and the reinstated 2025 earnings forecast.

For the third quarter, Delta expects adjusted profit of $1.25 to $1.75 per share, compared with expectations of $1.34.

Separately, the company also signaled that it will be evaluating changes at the front of the plane as premium tickets have performed better than the economy section this year.

According to a CNBC report, Delta’s revenue from premium seats, such as business class, gained 6% in the first half of the year to $10.6 billion. In comparison, main cabin economy ticket revenue dropped 4% to $11.7 billion.

Delta stock has fallen 5.8% this year.

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