Delta Airlines (DAL) has unveiled the next phase of a terminal expansion at John F. Kennedy International Airport. The project adds 11 gates and 75,000 square feet to Terminal 4’s and continues Delta’s $1.2B investment to enhance and expand the terminal. Delta said in a filing that it expects a December quarter operating margin of 12% – 13%, a 400 basis point improvement over the 8.5% operating margin for the December 2013 quarter. Unit costs for the quarter are expected to increase less than 1% driven by the continued benefits from Delta’s domestic refleeting and cost reduction initiatives. Delta expects approximately 835 million diluted and approximately 825 million basic weighted average shares outstanding. Sees Q4 PRASM up about 1%, sees system capacity up 3.5%. Sees CASM ex-fuel up about 1%.
Delta Air Lines January weekly call option implied volatility is at 49, February is at 43, March is at 45; compared to its 26-week average of 37 according to Track Data, suggesting large near term price movement into the expected release of Q4 in January 20.
Delta’s weekly chart shows a persistent uptrend, and the stock is currently trading in a pullback from highs above $42.72 weekly support. A move higher on increased volatility could see DAL trade near $49.50 resistance.