With all the changes should not DAL (Delta) stock price go up up up?

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First – I am not a stock guru. This post is NOT a suggestion in any possible way to buy DAL stock or any other stock. Also I know there is more to stock prices than what is to follow!

So what is this. This is my day to gripe a bit about my beloved airline that I do really like. Delta does a bunch right but as a medallion, we have taken it on the chin a bunch in 2011. And not just medallions. What am I most “soap boxing” about then? Let’s start with bumps. “IT” at Delta has been great at fixing things that cost the airline money. For example, in the past, if you got a bump, you would be re-booked in Y or A class most of the time. So, you got some extra points, free upgrades many times, and some extra MQM’s. A great perk to make you want to give up your seat. On those rare days you could take two bumps back to back you could rack up a nice sum of “delta dollars” and use a ton of them all on one ticket to fly somewhere nice. As we who read, DeltaPoints.com all know, not any more. If you want to see the new verbiage it is spelled out by the T&C of the one I got on my last trip.

Should I be complaining about free money from Delta? I think so. Why? Because any more changes and Delta Dollars may soon become Delta Pesos. We do not need more exchange rate comparisons.

Now not just this rule, but the others are making me a bit crazy. The no-change inside 72 hours of flight for skymiles tickets and it’s many changes still makes my blood boil as well as many other medallions. So here is the point to today’s post. If all these changes are to make such a huge impact on the company’s bottom line (as the company says), should not the stock price reflect that? Some say it takes time to show in the stock. But what stock gurus say is that a stock price reflects what the market thinks a stock will do in the next 6 months so the price shows that. Look at the DAL chart for the past few years:

Now in Feb. of 2009 DAL was all the way down to $5 range. April 2010 back up to $15. Then in Aug. for 2011, at the time all the T-72 changes were happening, down to $7. Today DAL is under $10 and will announce earnings this week talked about HERE and HERE.

So maybe charging for everything, sticking us with every fee they can, devaluing the skymiles in regards to flying BE to Hawaii, making Silver Medallion worth less than before, and the things talked about above will make DAL more money. So check back next year this time. If DAL is at $20 a share, I guess making us all crazy worked. If it is back at $5 range – maybe not so much! – René

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3 comments

  1. er in the grand scheme of dl earnings these are very minor points and will have no material impact on stock price

  2. @ phil – yes thus my warning this is more a rant than anything. but the company line is these changes must happen to save money. thus my reason for the rant!… and then again maybe the the point of your comment as well! – Rene

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