Is Delta Air Lines Inc (DAL) overvalued?
On Equity Rank's model estimate, DAL trades 51% above its fair value. Delta Air Lines Inc (DAL) last closed at $87.20; the multi-method model fair value is $57.59.
| Price | Model fair value | Price vs model |
|---|---|---|
| $87.20 | $57.59 | 51% above |
What the answer rests on
- 1 of 12 valuation methods put DAL's value above its price and 11 put it below, so the methods mostly agree.
- To justify today's price, DAL's free cash flow would need to grow about 5.9% a year for ten years (a reverse discounted cash flow).
- DAL trades at 17.8 times its last year's earnings, against a median of 9.6 for 7 profitable Airlines companies.
- Over the past year the price sat below the model fair value on 0% of trading days. The gap ranged from 12% above to 84% above the model fair value.
Read this before relying on it
The model fair value is an estimate from published financial statements. It is not a forecast of where the price goes, and it can be wrong. Within 10% either side we call it close to fair value: valuation models are not precise enough to read more into a smaller gap. Our own lists have no proven edge over the market yet; the live record shows every result, misses included.
Every valuation method behind DAL's fair value · What prices assume · Other companies