One Wall Street analyst sees 26% upside for Delta Air Lines shares

Delta Air Lines (Delta)Air Lines (NYSE: DAL)has recently received a series of analyst upgrades, with theDeutsche Bank ( Deutsche Bank )The stock has been rated Buy and the price target has been raised to $60 from $50 by analysts at The Analytica Group, Inc. That means the stock will rise 26% from its previous price over the next 12 months.

Deutsche Bank has upgraded the company's stock after its first-quarter results were well-received. According to the analyst, the quarterly results provide a good foundation for the company's full-year growth.

Delta Air Lines' Upbeat Financial Results

Discussion in mid-March Morgan (name)At the Chase Industrial Conference, Delta's Koon management announced a trading update that investors had been expecting. Koon said that revenue growth for the first quarter would be in the upper half of the 3%-6% guidance range. After the release of the financial results, revenue growth reached 6%, which is higher than expected.

Better yet, Delta's closely watched non-fuel cost per available seat mile (CASM-Ex) increased 1.51 TP3T versus guidance of 31 TP3T.

Investors are watching the CASM-Ex numbers very closely because Delta has little control over fuel costs and investors have a good handle on fuel prices by watching the Jet Fuel Price Index. Adjusted fuel prices for the quarter were $2.76 per gallon, beating management's estimate of $2.50 to $2.70 per gallon.

Overall, EPS of $0.45 met the upper end of guidance of $0.25 to $0.50 and management reiterated its full year guidance of $6 to $7 EPS and $3 billion to $4 billion free cash flow.

Is Delta Air Lines stock worth buying?

I agree with analysts that the stock is very attractive. Glenn Hauenstein, president of Delta Air Lines, said on an earnings call:"American ExpressContinued Strength of the Media Brand Group, Reports Record $1.7 Billion in Quarterly Reports

Delta Air Lines CEO Glenn Hauenstein said on the earnings call, "The strength of the Amex brand name set continues, with a record $1.7 billion reported for the quarter. At the same time, the positive results from CASM-Ex mean that the outlook for full-year margins is favorable.

Should you invest $1,000 in Delta Airlines now?

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A Wall Street Analyst Says Delta Air Lines Stock Has 26% of Upside was originally published by The Motley Fool.