Delta Swot Analysis Essay

Q3 - OE_Strengths

What do you see as Delta’s particular strengths?

"From a company perspective, they have a strong brand position. Strong financial position. Clear strategic direction. Those are the big strengths."

Q4 - OE_Weaknesses

What do you see as Delta’s particular weaknesses?

"Inconsistent approach to capacity discipline. Potentially value destructive approach to international stakes, or international investments, however you want to put it. Those are the big ones."

Q6 - OE_StrategyElements

Based on communications from Delta, what are the main elements of management’s business strategy?

"The strategy is capacity discipline, coupled with reasonable pricing, leading to 10% per year earnings growth. That's their target, with 70%

"Capacity discipline and pricing goals are the challenges, because they haven't been consistent there. They have messaged it consistently, but there have been periods over the last 18-24 months where their capacity growth has been demonstrably above what they communicated."

Q10

When do you believe Delta will initially achieve its 16-18% operating margin target?

"2018. 2018, but this is hard to know, and it depends on the overall environment. Most likely 2018, but certainty attached to 2018 is low."

Q12 - OE_ClosestInvestmentPeers

Not limiting your thoughts to just industry peers, which companies would you consider to be Delta’s closest peers?

"American and United. They are the two most comparable investment peers."

Q12a - OE_PreferredInvestment

Thinking about Delta along with its peers, which company is your preferred investment?

"Delta."

Q12b - OE_PreferredInvestmentWhy

Why do you say that? (Reasons for preferred investment)

"Delta. They are a better managed company. They are a very clean, both the operational and financial story. Less earnings risk relative to those

4 because there is still a gap on a multiple basis as to where the industry trades on its earnings relative to other industrial companies, which is an opportunity. But the risk that offsets that, is that there is a lot of capacity growth within the industry today. And there aren't as many checks on keeping that capacity lower, as one would like."

Q13 - OE_MeetExceed12-24Months

What do you believe Delta needs to accomplish over the next 12 to 24 months to meet or exceed your expectations for the company?

"Demonstrable consistent pricing power. And that is really most of it."

Q15aa

On the six-point scale where 6=extremely important and 1=not too important, how important do you believe "Repurchase shares" is for Delta to pursue as a capital deployment initiative?

"5 [6-pt scale]. I'm indifferent between buy backs and dividends."

Q15bb

On the six-point scale where 6=extremely important and 1=not too important, how important do you believe "Increase the dividend" is for Delta to pursue as a capital deployment initiative?

"5 [6-pt scale]. I'm indifferent between buy backs and dividends."

Q19a - OE_MostImportantThingsNeedToKnowMoreAbout

What are the two or three most important things you need to know more about in order for you to have greater confidence in Delta as an