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Delta Air Lines' (DAL) April Traffic Up, PRASM Down 4%

Delta Air Lines Inc. DAL posted impressive air traffic data in the month of April. Traffic – measured in revenue passenger miles (RPMs) – was 17.34 billion, up 2.7% from 16.89 billion recorded a year ago.

On a year-over-year basis, consolidated capacity (or available seat miles/ASMs) inched up 2.5% to 20.81 billion. Meanwhile, the load factor or percentage of seats filled by passengers decreased by 10 basis points to 83.3%.

At the end of the first four months of 2016, Delta generated RPMs of 65.05 billion (up 3.1% year over year) and ASMs of 78.95 billion (up 2.7% year over year). Load factor stood at 82.4% versus 82.1% recorded last April. Likewise, passenger count in the month grew 3.1% while that for the first four months of this year rose 4.3%.

However, Delta witnessed a 4% drop in PRASM (passenger revenue per available seat mile) in the month mainly impacted by volatile foreign currency exchange rates. Moreover, soft passenger yields (average fare paid per mile, per passenger) from domestic markets affected the PRASM figure.

The company’s significant route expansion plans, introduction of ancillary products, fleet revamping and customer service enhancement bode well. Further, the company has been reaping considerable benefits from its joint ventures and code share agreements.

Zacks Rank & Stocks to Consider

Delta currently carries a Zacks Rank #3 (Hold). Better-ranked stocks in the same space include SkyWest Inc. SKYW, GOL Linhas Aereas Inteligentes S.A. GOL and Ryanair Holdings plc RYAAY. SkyWest sports a Zacks Rank #1 (Strong Buy) while the other two companies carry a Zacks Rank #2 (Buy).

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RYANAIR HLDGS (RYAAY): Free Stock Analysis Report
 
GOL LINHAS-ADR (GOL): Free Stock Analysis Report
 
DELTA AIR LINES (DAL): Free Stock Analysis Report
 
SKYWEST INC (SKYW): Free Stock Analysis Report
 
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