Delta Air Lines Inc (DAL) said on Thursday that it forecast a cash burn rate within the range of $12 million to $14 million per day during the fourth quarter amid slowing demand for air travel and surging new COVID-19 infections.
Delta Air shares closed higher for a second consecutive trading session in New York on Thursday. It has also been the sharpest single-session gain since November 24th. The stock went up 4.58% ($1.88) to $42.95, after touching an intraday high at $43.75, or a price level not seen since March 11th ($44.34).
Shares of Delta Air Lines Inc have retreated 26.56% so far in 2020 compared with a 13.49% gain for the benchmark index, S&P 500 (SPX).
In 2019, Delta Air’s stock went up 17.19%, thus, it again underperformed the S&P 500, which registered a 28.88% gain.
Delta Air expects its revenue to shrink to 30% of 2019 levels ($11.44 billion) during the fourth quarter.
In other news, the airline is collaborating with the Centers for Disease Control and Prevention, so that international clients are constantly informed of potential COVID-19 exposure through contact tracing.
Customers who travel to the United States from other parts of the globe will be asked to voluntarily provide five pieces of data in support of contact tracing and public health follow-up efforts, starting December 15th, the air carrier said.
Analyst stock price forecast and recommendation
According to CNN Money, the 19 analysts, offering 12-month forecasts regarding Delta Air’s stock price, have a median target of $40.00, with a high estimate of $54.00 and a low estimate of $30.00. The median estimate represents a 6.87% downside compared to the closing price of $42.95 on December 3rd.
The same media also reported that at least 11 out of 23 surveyed investment analysts had rated Delta Air’s stock as “Buy”, while other 11 – as “Hold”.