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Bernstein Flags Fuel Headwinds but Stays Bullish on Delta’s (DAL) Flight Path

Delta Air Lines Inc. (NYSE:DAL) is one of the 10 most undervalued industrial stocks to buy according to analysts. On June 18, Bernstein analyst David Vernon revised his near-term view on Delta Air Lines, trimming the price target slightly to $60 from $61 while maintaining an Outperform rating.

The analyst’s downward adjustment to the target price reflect his latest hike in fuel cost estimates. He attributes the rise to the growing geopolitical risks and the ongoing tensions between Iran and Israel. The analyst notes that while airlines can typically pass fuel costs onto consumers through higher fares, in such scenarios, the pricing power weakens, especially if geopolitical concerns hit traveler sentiment. Thus, it becomes difficult for companies to pass on the costs to consumers during supply-driven price shocks.

Pixabay/Public Domain

Bernstein also notes that the continued uncertainty in the Middle East could dampen demand during the summer travel period which is important for the sector. This adds another layer of complexity to forecasting near-term performance, prompting a more cautious stance in earnings estimates.

Despite these pressures, Vernon’s overall rating remains positive, suggesting confidence in Delta’s longer-term positioning and operational strength even as short-term headwinds persist.

Delta Air Lines Inc. provides scheduled air transportation for passengers, freight, and mail over a network of routes.

While we acknowledge the potential of DAL as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

READ NEXT: The Best and Worst Dow Stocks for the Next 12 Months and 10 Best Tech Stocks to Buy According to Billionaires.

Disclosure: None.

The $250 Trillion AI Hype is Real. A few years from now, you’ll probably wish you’d bought this stock.

When Jeff Bezos said that one breakthrough technology would shape Amazon’s destiny, even Wall Street’s biggest analysts were caught off guard.

Fast forward a year and Amazon’s new CEO Andy Jassy described generative AI as a “once-in-a-lifetime” technology that is already being used across Amazon to reinvent customer experiences.

At the 8th Future Investment Initiative conference, Elon Musk predicted that by 2040 there would be at least 10 billion humanoid robots, with each priced between $20,000 and $25,000.

Do the math. According to Musk, this technology could be worth $250 trillion by 2040.

Put another way, that’s roughly equal to:

  • 175 Teslas
  • 107 Amazons
  • 140 Metas
  • 84 Googles
  • 65 Microsofts
  • And 55 Nvidias

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It’s a leap so massive, it could reshape how businesses, governments, and consumers operate worldwide.

Even if that $250 trillion figure sounds ambitious, major firms like PwC and McKinsey still see AI unlocking multi-trillion-dollar potential.

How could anything be worth that much?

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  • Bill Gates sees artificial intelligence as the “biggest technological advance in my lifetime,” more transformative than the internet or personal computer, capable of improving healthcare, education, and addressing climate change.
  • Larry Ellison — through Oracle, is spending billions on Nvidia chips and partnering with Cohere to embed generative AI across Oracle’s cloud and apps.
  • Warren Buffett — not known for tech hype — says this breakthrough could have a ‘hugely beneficial social impact.

When billionaires from Silicon Valley to Wall Street line up behind the same idea — you know it’s worth paying attention to.

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