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Top Delta Airlines’ Insiders Offload Shares; Street Says Buy
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Top Delta Airlines’ Insiders Offload Shares; Street Says Buy

Story Highlights

Even as travel demand and unit pricing are expected to tick upwards, top management at Delta Airlines has been selling shares worth millions.

A combination of pent-up demand, easing COVID-19 restrictions, and rising fuel and labor costs has led to Delta Airlines (DAL) shares gyrating throughout 2022.

Last week, Delta noted that it expects Q2 revenue to scale back to pre-pandemic levels despite the lower number of flights. Additionally, it expects 8% better revenue per seat than its initial estimates.

Despite this somewhat rosy outlook, TipRanks data reveals that three of Delta’s top insiders have been dumping the company’s shares. This includes CEO and Director Edward Bastian, EVP & Chief People Officer Joanne D. Smith, and EVP of Global Sales, Steven M. Sear.

Over the last three months, insiders have sold Delta shares worth $2.6 million, indicating a very negative insider confidence signal in the stock.

Most importantly, all of these Sells were informative in nature. Five days ago, Joanne Smith and Sear Steven sold DAl shares worth $851,849 in total.

Meanwhile, on May 25, Edward Bastian sold 27,664 DAl shares at about $39.55 per share. The powerful TipRanks Insider Trading tool highlights that Bastian has had a 32% success rate in his DAL transactions so far. The CEO of the company still holds about $17.22 million in DAL shares.

Analyst’s Take

Notably, despite these insider moves, the Street is sticking with DAL. Goldman Sachs’ Catherine O’Brien has reiterated a Hold rating on the stock while increasing the price target to $45 from $44. The analyst is favorable on the stock due to the guidance of better than anticipated revenue trends coupled with higher unit revenue.

Overall, the Street has a Strong Buy Consensus rating on DAL based on 12 Buys and a Hold. The average DAL price target of $52.91 implies a potential upside of 37.29%.

Closing Note

These insider moves come at a time when DAL is expected to perform better and has posted upbeat guidance. While COVID-19 restrictions are finally easing, the rising incidence of monkeypox across multiple countries remains a key point of concern to keep an eye on.

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