Market News

Delta, Alaska Cancel More Flights Amid Rising Omicron cases

Hundreds of flights were canceled for the fifth day in a row on December 28 by U.S carriers due to bad weather and higher Omicron variant cases, according to Reuters.

Delta Air Lines (NYSE: DAL) canceled over 250 of its 4,133 flights scheduled for Tuesday. The airlines have stated that it is working to re-route and substitute some planes.

Alaska Air Group (NYSE: ALK), canceled 170 flights. Further, it issued a warning of more cancelations and delays throughout the week. The airline plans to reduce Seattle departures by about 20% to allow for more time to de-ice the aircraft.

Increasing Omicron Cases a Cause of Concern

Earlier on Monday, U.S. carriers canceled over 1,000 flights as airlines continue are impacted by staff shortages due to COVID-19 infections, resulting staff quarantine protocols, and bad weather. 

According to Reuters, in the last seven days, the average number of new COVID-19 cases in the U.S. has risen 55% to over 205,000 per day.

CDC Comes to Airlines’ Rescue

In response to the airlines’ request to help them deal with the staff shortages, the U.S. Centers for Disease Control and Prevention (CDC) announced that it was reducing the recommended isolation time to five days compared to 10 days, if they are asymptomatic.

The move comes as a positive and should help the airlines recoup their staff strength.

Analysts Recommendation

On December 17, JPMorgan analyst Jamie Baker decreased the price target on Delta Air Lines to $51.00 (28.7% upside potential) from $61 and reiterated a Buy rating.

The Wall Street community is cautiously optimistic about the DAL stock with a Moderate Buy consensus rating based on 9 Buys and 4 Holds. The average Delta Airlines price target of $52.17 implies 31.6% upside potential to current levels.

Bloggers Weigh In

TipRanks data shows that financial blogger opinions are 94% Bullish on DAL stock, compared to a sector average of 68%.

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