5 Best Transportation Stocks To Buy Heading Into 2023

4. Delta Air Lines, Inc. (NYSE:DAL)

Number of Hedge Fund Holders: 53

Delta Air Lines, Inc. (NYSE:DAL) is a Georgia-based provider of air transportation for passengers and cargo in the United States and internationally. It is one of the best transportation stocks to consider for 2023. On December 5, Delta Air Lines, Inc. (NYSE:DAL) made an initial deal with the union representing its pilots for pay raises and improved benefits such as paid vacation and retirement contributions in order to avert strikes.

On December 5, Morgan Stanley analyst Ravi Shanker chose Delta Air Lines, Inc. (NYSE:DAL) as his new “Top Pick” for 2023 among North American airlines, replacing Southwest Airlines Co. (NYSE:LUV). The analyst remains bullish on the air travel outlook for “the third year in a row” and his estimates for the sector are 43% greater than consensus for 2023 and 18% for 2024, on average. The analyst has an Overweight rating and a $65 price target on Delta Air Lines, Inc. (NYSE:DAL) shares.

According to Insider Monkey’s data, Delta Air Lines, Inc. (NYSE:DAL) was part of 53 hedge fund portfolios at the end of September 2022, compared to 49 in the prior quarter. Jim Simons’ Renaissance Technologies is the largest stakeholder of the company, with 8.8 million shares worth $247.3 million. 

Here is what Miller Value Partners specifically said about Delta Air Lines, Inc. (NYSE:DAL) in its Q3 2022 investor letter:

“Delta Air Lines, Inc. (NYSE:DAL) ($29.42) is a high-quality airline (yes, there really is such a thing!).  It didn’t issue any equity in the pandemic. It focuses on delivering a superb customer experience and has brand loyalty (including a stable revenue stream from partner American Express, growing at 20%/ year). Maybe the best evidence: it’s managed to outperform the S&P 500 over the past decade despite a horrible pandemic ending point (+13.2% vs. 11.7%1 ). It trades for 4x 2024 earnings! If it eventually trades at Southwest’s historical valuation, it implies this stock should double as well.”