10 Best Transportation Stocks to Buy According to Hedge Funds

5. Delta Air Lines Inc. (NYSE:DAL)

Number of Hedge Fund Investors: 83

One of the biggest airlines in the world and the best transportation stocks, Delta Air Lines Inc. (NYSE:DAL) is headquartered in Atlanta and operates a network of more than 300 destinations in more than 50 countries. The firm uses a hub-and-spoke network to gather and transport passengers around the world, with its main hubs in Atlanta, New York, Salt Lake City, Detroit, Seattle, and Minneapolis-St. Paul. Historically, passenger flights over the Atlantic Ocean have accounted for the majority of its international revenue and profits. It operates through airline and refinery segments.

Revenue in 2024 climbed to $14.44 billion, exceeding the consensus forecast of $14.18 billion. Earnings per share came in at $1.85, exceeding analysts’ expectations of $1.78%. Delta Air Lines, Inc. (NYSE:DAL) expects the trend of better-than-expected results to continue into 2025. In 2024, the airline anticipates its revenues to rise by 7% to 9%. It also aims to generate more than $4 billion in free cash, up 18% from 2024. It estimates annual adjusted earnings of more than $7.35 per share for the full year.

Delta Air Lines, Inc. (NYSE:DAL) and its earnings growth prospects are favored by two variables. The first is an increase in non-main cabin ticket sales, which includes premium cabin sales and American Express’s revenue from co-branded credit cards. The second arises from a recently developed airline industry discipline that requires capacity reduction when necessary. American Express’s compensation has also risen from $2 billion in 2010 to an expected $7 billion in 2024, with management aiming for a total of $10 billion. In addition to diversifying Delta’s earnings, the SkyMiles program and credit cards encourage customer participation and loyalty.