American Airlines vs Delta Air Lines Which Should You Buy?

American Airlines and Delta Air Lines are two major players in the aviation industry, both boasting extensive routes and a large customer base. While both companies have faced challenges in recent years, including the impact of the COVID-19 pandemic on air travel demand, they have also shown resilience and adaptability. Investors looking to capitalize on the potential recovery of the airline industry may find opportunities in both American Airlines and Delta Air Lines stocks, but must carefully consider factors such as financial health, competitive positioning, and growth prospects.

American Airlines or Delta Air Lines?

When comparing American Airlines and Delta Air Lines, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between American Airlines and Delta Air Lines.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. American Airlines has a dividend yield of -%, while Delta Air Lines has a dividend yield of 0.81%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. American Airlines reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%. On the other hand, Delta Air Lines reports a 5-year dividend growth of 0.00% year and a payout ratio of 5.99%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with American Airlines P/E ratio at 41.21 and Delta Air Lines's P/E ratio at 8.19. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. American Airlines P/B ratio is -2.33 while Delta Air Lines's P/B ratio is 2.89.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, American Airlines has seen a 5-year revenue growth of -0.16%, while Delta Air Lines's is 0.41%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with American Airlines's ROE at -5.42% and Delta Air Lines's ROE at 39.94%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $17.23 for American Airlines and $61.39 for Delta Air Lines. Over the past year, American Airlines's prices ranged from $9.07 to $18.20, with a yearly change of 100.66%. Delta Air Lines's prices fluctuated between $36.34 and $67.50, with a yearly change of 85.75%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.