Delta Air Lines, Inc. (NYSE:DAL) stock rose 2.25% (As on April 17, 11:17:51 AM UTC-4, Source: Google Finance) after Deutsche Bank sees considerable upside of the company even with the airline company warning on the difficult recovery trajectory for the industry. Analyst Michael Linenberg pointed to a strong Q2 outlook from Delta and thinks the management team has pulled the right levers to outperform airline peers. “We endorse management’s focus on margins, earnings, and cash generation which, in our view, are the surest path to value creation. This is particularly important when the industry is in a fragile state (i.e., subject to delays/cancellations with FAA staffing issues, supply chain problems, inclement weather, etc.). On the latter, Delta has made tremendous progress over the past couple of years in hiring and training staff, investing in its fleet, upgrading technology, etc. in support of its future growth.”

DAL in the first quarter of FY 23 has reported the adjusted earnings per share of 15 cents, missing the analysts’ estimates for the adjusted earnings per share of 29 cents, according to Zacks Investment Research. The company had reported the adjusted revenue growth of 45 percent to $12.76 billion in the fourth quarter of FY 22, missing the analysts’ estimates for revenue of $12.77 billion. Record March quarter free cash flow of $1.9 billion enabled $1.2 billion of debt repayment and positions us to complete our full year planned debt reduction in the first half of the year. The company is on track to reduce leverage to 3x to 3.5x in 2023 and remain committed to returning to investment grade metrics by next year. The recent upgrades on the debt rating outlooks by S&P and Fitch recognize the continued progress on delivering the balance sheet

For the second quarter ending in June, Delta expects its per-share earnings to range from $2 to $2.25. The company expects full-year earnings in the range of $5 to $6 per share. The current consensus estimate is earnings of $1.38 per share for the quarter ending June 30, 2023, and earnings of $5.20 per share for the year ending December 31, 2023. The company is confident in the full-year guidance for revenue growth of 15 to 20% year-over-year and free cash flow of over $2 billion.