Financial Review: JetBlue Airways Corporation (JBLU) & Delta Air Lines (DAL)

JetBlue Airways Corporation (NASDAQ: JBLU) and Delta Air Lines (NYSE:DAL) are both mid-cap transportation companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, profitability, analyst recommendations, risk, valuation, institutional ownership and earnings.

Earnings and Valuation

This table compares JetBlue Airways Corporation and Delta Air Lines’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
JetBlue Airways Corporation $6.82 billion 0.94 $1.54 billion $1.97 9.85
Delta Air Lines $39.88 billion 0.88 $7.48 billion $5.03 9.59

Delta Air Lines has higher revenue and earnings than JetBlue Airways Corporation. Delta Air Lines is trading at a lower price-to-earnings ratio than JetBlue Airways Corporation, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares JetBlue Airways Corporation and Delta Air Lines’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
JetBlue Airways Corporation 9.78% 16.75% 6.99%
Delta Air Lines 9.30% 28.33% 7.06%

Dividends

Delta Air Lines pays an annual dividend of $1.22 per share and has a dividend yield of 2.5%. JetBlue Airways Corporation does not pay a dividend. Delta Air Lines pays out 24.3% of its earnings in the form of a dividend. Delta Air Lines has raised its dividend for 3 consecutive years.

Analyst Recommendations

This is a breakdown of recent recommendations for JetBlue Airways Corporation and Delta Air Lines, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
JetBlue Airways Corporation 1 7 5 0 2.31
Delta Air Lines 0 1 15 0 2.94

JetBlue Airways Corporation currently has a consensus price target of $25.80, suggesting a potential upside of 32.99%. Delta Air Lines has a consensus price target of $62.31, suggesting a potential upside of 29.14%. Given JetBlue Airways Corporation’s higher possible upside, equities research analysts clearly believe JetBlue Airways Corporation is more favorable than Delta Air Lines.

Volatility & Risk

JetBlue Airways Corporation has a beta of 0.59, meaning that its stock price is 41% less volatile than the S&P 500. Comparatively, Delta Air Lines has a beta of 1.25, meaning that its stock price is 25% more volatile than the S&P 500.

Institutional & Insider Ownership

84.5% of JetBlue Airways Corporation shares are held by institutional investors. Comparatively, 86.5% of Delta Air Lines shares are held by institutional investors. 0.6% of JetBlue Airways Corporation shares are held by company insiders. Comparatively, 0.4% of Delta Air Lines shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Summary

Delta Air Lines beats JetBlue Airways Corporation on 11 of the 17 factors compared between the two stocks.

About JetBlue Airways Corporation

JetBlue Airways Corporation is a passenger carrier company. The Company provides air transportation services across the United States, the Caribbean and Latin America. Its segments include Domestic, and Caribbean & Latin America. It operates various kinds of aircrafts, including Airbus A321, Airbus A320 and Embraer E190. It also provides premium transcontinental product called Mint. As of December 31, 2016, Mint included 16 fully lie-flat seats, four of which were in suites with a privacy door. The Company also provides Fly-Fi in-flight Internet service across its Airbus fleet. It provides its customers a choice to purchase tickets from three branded fares, which include Blue, Blue Plus and Blue Flex. Each of these fare include different offerings, such as free checked bags, reduced change fees and additional TrueBlue points. As of December 31, 2016, its Airbus A321 aircraft in a single cabin layout had 200 seats and those with Mint premium service had a seating capacity of 159 seats.

About Delta Air Lines

Delta Air Lines, Inc. provides scheduled air transportation for passengers and cargo throughout the United States and across the world. The Company’s segments include Airline and Refinery. The Company’s route network is centered around a system of hub, international gateway and airports that the Company operates in Amsterdam, Atlanta, Boston, Detroit, London-Heathrow, Los Angeles, Minneapolis-St. Paul, New York-LaGuardia, New York- John F Kennedy International Airport, Paris-Charles de Gaulle, Salt Lake City, Seattle and Tokyo-Narita. Each of these operations includes flights that gather and distribute traffic from markets in the geographic region surrounding the hub or gateway to domestic and international cities and to other hubs or gateways. The Company’s route network includes its international joint ventures, its alliances with other foreign airlines, its membership in SkyTeam and agreements with multiple domestic regional carriers that operate as Delta Connection.

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