Insider Buying: Delta Air Lines’ Chairman Buys $500K Worth of Stock

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Insiders have access to real-time information on their companies and often also have a wealth of experience and knowledge that can help them evaluate their firms’ prospects. If they are buying company stock, it’s generally worth taking a closer look.

Here, we are going to highlight some interesting legal insider buying at Delta Air Lines Inc (DAL:US). Delta is one of the world’s largest airlines. Operating from nine hubs, it flies to 52 countries on six continents. It’s listed on the New York Stock Exchange and currently has a market capitalization of approximately $25.58 billion.

Insider Buying at Delta Air Lines

Our insider transaction data shows that on January 18, the Chairman of Delta, Francis Blake, purchased 12,880 DAL shares at a price of $38.58 per share. This purchase cost the insider around $500,000 and increased his holding to 93,795 shares.

First Purchase Since 2019

The insider activity is worth highlighting for a couple of reasons.

Firstly, Mr. Blake has served on the board since 2014 and has served as Chairman since October 2016. This means that he is likely to know the business well.

Secondly, this is his first purchase since January 2019. And the Chairman has spent a significant amount of money on company stock which suggests that he is confident in the prospects of the business.

Favorable Outlook

Delta recently produced a strong set of full-year results and indicated that the outlook for the business is positive.

For the quarter, operating revenue was $12.3 billion, 8% higher than the figure achieved in the final quarter of 2019. Meanwhile, for the year, operating revenue was $45.6 billion – just 2% lower than full-year 2019. Pre-tax income for the full-year 2022 was $2.7 billion with a pre-tax margin of 5.9%.

Looking ahead, total revenue in 2023 is expected to be up 15-20% on the 2022 figure. And the operating margin is expected to be between 10% and 12%. EPS is predicted to climb to a range of between $5 and $6.

"Delta people rose to the challenges of 2022, delivering industry-leading operational reliability and financial performance. As we move into 2023, the industry backdrop for air travel remains favorable and Delta is well positioned to deliver significant earnings and free cash flow growth,” said CEO Ed Bastian.

In light of the outlook here, we see the recent legal insider trades at Delta as a bullish development.