Will Delta’s New SIXT Partnership Reshape the Loyalty Value Proposition for SkyMiles and DAL Investors?

• Earlier this month, Delta Air Lines partnered with SIXT USA to allow SkyMiles members to earn and redeem miles on SIXT rentals booked through Delta's Cars & Stays platform at more than 2,000 locations globally, including 51 major U.S. airports.
• This collaboration aligns two premium travel brands and highlights Delta’s ongoing emphasis on enhancing loyalty rewards and creating seamless, high-end travel experiences for its customers.
• To understand how this expanded loyalty program footprint factors into Delta's investment outlook, let’s revisit the company’s updated business narrative.

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Delta Air Lines Investment Narrative Recap

To be a Delta Air Lines shareholder today, you need confidence in the firm’s ability to grow its premium and loyalty businesses while managing costs and maintaining margins despite a soft domestic travel market. The recent SIXT partnership enhances loyalty offerings, but its impact on the most important short-term catalyst, resilient premium and international travel growth, remains limited, and does not materially change the risks tied to economic uncertainty and slower main cabin demand.

One recent announcement that stands out is Delta’s reaffirmed full-year earnings guidance and a plan to reduce its debt by US$3 billion, paired with a 25% dividend increase. This underlines a focus on financial discipline and shareholder returns, echoing management’s priority to protect free cash flow and margins even as new alliances, like the one with SIXT, expand the customer experience.

However, given ongoing economic uncertainty and the recent flatness in domestic travel, investors should also be mindful that...

Read the full narrative on Delta Air Lines (it's free!)

Delta Air Lines' outlook forecasts $67.9 billion in revenue and $4.7 billion in earnings by 2028. This scenario is based on annual revenue growth of 3.1% and a $0.2 billion increase in earnings from $4.5 billion today.

Uncover how Delta Air Lines' forecasts yield a $64.37 fair value, a 16% upside to its current price.

Exploring Other Perspectives

Seven members of the Simply Wall St Community estimated Delta’s fair value between US$40.57 and US$86.63 per share. These varied outlooks contrast with analysts’ focus on risks from economic uncertainty and stalled demand, highlighting the value of considering a range of viewpoints.

Explore 7 other fair value estimates on Delta Air Lines - why the stock might be worth as much as 56% more than the current price!

Build Your Own Delta Air Lines Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Delta Air Lines research is our analysis highlighting 2 key rewards and 3 important warning signs that could impact your investment decision.
• Our free Delta Air Lines research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Delta Air Lines' overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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