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Does Delta Air Lines Inc (NYSE:DAL) Have A Place In Your Portfolio?

Dividends can be underrated but they form a large part of investment returns, playing an important role in compounding returns in the long run. Over the past 5 years, Delta Air Lines Inc (NYSE:DAL) has returned an average of 2.00% per year to shareholders in terms of dividend yield. Let’s dig deeper into whether Delta Air Lines should have a place in your portfolio. Check out our latest analysis for Delta Air Lines

5 questions I ask before picking a dividend stock

If you are a dividend investor, you should always assess these five key metrics:

  • Is their annual yield among the top 25% of dividend payers?

  • Has its dividend been stable over the past (i.e. no missed payments or significant payout cuts)?

  • Has the amount of dividend per share grown over the past?

  • Is its earnings sufficient to payout dividend at the current rate?

  • Will it be able to continue to payout at the current rate in the future?

NYSE:DAL Historical Dividend Yield June 22nd 18
NYSE:DAL Historical Dividend Yield June 22nd 18

How does Delta Air Lines fare?

The company currently pays out 22.44% of its earnings as a dividend, according to its trailing twelve-month data, which means that the dividend is covered by earnings. Going forward, analysts expect DAL’s payout to remain around the same level at 24.40% of its earnings, which leads to a dividend yield of 2.82%. Furthermore, EPS should increase to $6.08.

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If dividend is a key criteria in your investment consideration, then you need to make sure the dividend stock you’re eyeing out is reliable in its payments. Unfortunately, it is really too early to view Delta Air Lines as a dividend investment. It has only been consistently paying dividends for 5 years, however, standard practice for reliable payers is to look for a 10-year minimum track record.

In terms of its peers, Delta Air Lines has a yield of 2.27%, which is high for Airlines stocks but still below the market’s top dividend payers.

Next Steps:

Taking all the above into account, Delta Air Lines is a complicated pick for dividend investors given that there are a couple of positive things about it as well as negative. However, if you are not strictly just a dividend investor, the stock could still offer some interesting investment opportunities. Given that this is purely a dividend analysis, you should always research extensively before deciding whether or not a stock is an appropriate investment for you. I always recommend analysing the company’s fundamentals and underlying business before making an investment decision. There are three fundamental factors you should look at:

  1. Future Outlook: What are well-informed industry analysts predicting for DAL’s future growth? Take a look at our free research report of analyst consensus for DAL’s outlook.

  2. Valuation: What is DAL worth today? Even if the stock is a cash cow, it’s not worth an infinite price. The intrinsic value infographic in our free research report helps visualize whether DAL is currently mispriced by the market.

  3. Dividend Rockstars: Are there better dividend payers with stronger fundamentals out there? Check out our free list of these great stocks here.


To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned.