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Airlines Soar as Earnings Hit New Highs

David Becker
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Airlines have seen strong gains recently as travel throughout the United States has increased and Jet Fuel prices have declined. Recent figures from the Department of Energy show that distillate demand has increased along with demand for Jet Fuel. With prices of energy declining, airlines should continue to benefit throughout the holiday season.

Travel generally increases from the period of late November unto the New Year. It seems that in 2013 consumer are using more of their discretionary spending on travel than other consumer services or goods.

Delta Air Lines, Inc. (NYSE:DAL) provides scheduled air transportation for passengers and cargo in the United States and internationally. Price action for Delta has been positive as the stock price has hit 2013 highs. The company has been benefitting from declining fuel costs, which have seen jet fuel prices decline nearly 13% since the beginning of September. The decline in jet fuel prices coincided with the increase in the price of the stock.

Delta has a 52-week range of $ 9.21 – $32.30. Sales in the last quarter increased 6% and the three year growth rate of sales for the company is up 23%. The price to earnings ratio for the stock is 10, and the profit margin for the company is 4.3%. The stock has a dividend yield of 0.9%.

As the price of the stock hit a new fresh 52-week high, momentum increased. The MACD (moving average convergence divergence) has hit its highest level in the past 6-months. The MACD index moved from negative to positive territory confirming the buy signal. The relative strength index (RSI) moved above 62, which is on the upper end of the neutral range reflecting robust momentum.

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