Why Delta Air Lines, Inc. (DAL) Went Down on Tuesday

We recently compiled a list of the 10 Stocks Battered by Bearish Outlooks. In this article, we are going to take a look at where Delta Air Lines, Inc. (NYSE:DAL) stands against the other stocks.

Ten firms ended Tuesday suffering a sell-off, as investor sentiment continues to be dampened by macroeconomic uncertainties and bearish outlooks from analysts and their management.

The stocks–three of which belong to the travel and tourism industry–registered losses following lower outlook guidance, taking into account the potential effects of President Donald Trump’s trade war with other countries.

The pessimistic sentiment mirrored the broader market decline, with the Dow Jones slashing another 1.14 percent during the day, the S&P dropping 0.76 percent, and the Nasdaq dipping 0.18 percent.

To come up with the list, we considered only the stocks with at least $2 billion in market capitalization and $5 million in trading volume.

An aerial view of a commercial aircraft taking off from a coastal hub.

Delta Air Lines, Inc. (NYSE:DAL)

Delta Air Lines, Inc. (NYSE:DAL) fell by 7.25 percent on Tuesday to finish at $46.68 apiece after announcing a lower sales outlook for the first quarter of the year.

In a regulatory filing, Delta Air Lines, Inc. (NYSE:DAL) said it now expects first quarter revenues to rise by less than 5 percent year-on-year, down from its previous forecast of 6 to 8 percent.

Earnings per share forecast was also lowered to between $0.30 and $0.50 from its previous guidance of $0.70 to $1 apiece.

“The outlook has been impacted by the recent reduction in consumer and corporate confidence caused by increased macro uncertainty, driving softness in Domestic demand,” the company said.

In a separate comment on CNBC, Delta Air Lines, Inc. (NYSE:DAL) Chief Executive Officer Ed Bastian said that while he does not expect a recession under the new administration, the weaker outlook guidance was mostly based on dampened consumer confidence, saying that its customers are now pulling back on bookings.

Overall DAL ranks 5th on our list of Tuesday’s worst performers. While we acknowledge the potential of DAL as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than DAL but trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.