Definitive Analysis
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Delta Air Lines, Inc. (DAL)

Company Dividend Discount ModelIndustry: Airlines, Airports & Air ServicesSector: Industrials

Valuation Snapshot

Stable Growth$66.30 - $101.85$82.86
Multi-Stage$88.87 - $97.56$93.13
Blended Fair Value$88.00
Current Price$56.75
Upside55.06%
DecisionBuy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS-20.01%2.49%0.490.200.000.000.401.501.391.120.780.55
YoY Growth--150.78%0.00%0.00%-100.00%-73.47%7.81%24.35%43.61%41.78%43.03%
Dividend Yield--1.13%0.41%0.00%0.00%0.83%5.27%2.67%2.04%1.70%1.13%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)4,630.00
(-) Cash Dividends Paid (M)414.00
(=) Cash Retained (M)4,216.00
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)926.00578.75347.25
Cash Retained (M)4,216.004,216.004,216.00
(-) Cash Required (M)-926.00-578.75-347.25
(=) Excess Retained (M)3,290.003,637.253,868.75
(/) Shares Outstanding (M)652.25652.25652.25
(=) Excess Retained per Share5.045.585.93
LTM Dividend per Share0.630.630.63
(+) Excess Retained per Share5.045.585.93
(=) Adjusted Dividend5.686.216.57
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate0.49%1.49%2.49%
Fair Value$66.30$82.86$101.85
Upside / Downside16.82%46.01%79.47%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)4,630.004,699.004,769.044,840.124,912.254,985.465,135.03
Payout Ratio8.94%25.15%41.37%57.58%73.79%90.00%92.50%
Projected Dividends (M)414.001,181.961,972.712,786.783,624.674,486.924,749.90

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate0.49%1.49%2.49%
Year 1 PV (M)1,072.721,083.391,094.07
Year 2 PV (M)1,624.911,657.411,690.23
Year 3 PV (M)2,083.292,146.112,210.17
Year 4 PV (M)2,459.232,558.592,660.93
Year 5 PV (M)2,762.882,903.113,048.98
PV of Terminal Value (M)47,963.5350,397.9852,930.29
Equity Value (M)57,966.5760,746.6063,634.68
Shares Outstanding (M)652.25652.25652.25
Fair Value$88.87$93.13$97.56
Upside / Downside56.60%64.11%71.92%

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