Delta shares took a significant hit from the surge in fuel prices as a result of the Iran conflict, but they're outperforming competitors. Last week, Delta raised its revenue forecast and trumpeted how it's better-positioned than other competitors during this time because it owns a refinery. Delta is poised to surpass to surpass its pre-pandemic earnings per share next year. It's a long-term turnaround story marked by an industry-leading brand and financial strength to weather shocks. Delta Airlines (DAL) shares have been under pressure from the oil surge tied to the Iran conflict. The sell-off has created a great buying opportunity for a century-old airline undergoing a successful long-term turnaround that's poised to surpass its earnings achieved before the pandemic decimated the industry. Shares of Atlanta-based Delta are off by about 13% from the 52-week high reached shortly before the war began and jet fuel prices spiked from the closure of the Strait of Hormuz. Delta's drawdown has not been as severe as the rest of the industry with the U.S. Global Jets ETF off by 19% from its pre-war high. The shares rebounded with other airlines Monday as President Donald Trump signaled there were talks with Iran to reopen the strait, which caused oil prices to pull back. Navigating the current turmoil There's good reason why Delta is a relative outperformer during the sell-off this month. The company raised its revenue forecast last week in the middle of the turmoil. Delta said first quarter revenue would be in the high single digits, versus prior guidance of a 5% to 7% increase. "Consumer and corporate trends have accelerated into March," stated the presentation the company made at the JPMorgan Industrials conference. The company said its earnings for the first quarter would still fall between 50 cents and 90 cents a share despite the spike in fuel costs. Delta has the ability to handle those higher fuel costs better than competitors because it owns a refinery under its Monroe Energy subsidiary near Philadelphia, a unique advantage over other airlines. "The fact that we refine our own fuel up at Monroe gives us a meaningful hedge," said CEO Ed Bastian at the JPMorgan conference. And Delta's turnaround in customer perception since the pandemic allows it to pass on the fuel costs more so than others. "The health of our brand, our premium brand, is important. Gives us a position of strength in which to price for the higher fuel," said Bastian. Long-term turnaround Airlines are among the few industries that have been unable to surpass their pre-pandemic earnings. But Delta is poised to get there soon. The company is expected to earn $6.69 cents a share in 2026 and $8.25 a share in 2027, according to the consensus estimates collected from analysts by FactSet. So at some point early next year, they will move past the $7.33 earnings per share notched in 2019. It's not just in financial terms that Delta has righted the ship since the pandemic lows. The company has built a wide moat among consumer and corporate travelers through a number of measures: Building up a network of airport lounges American Express loyalty program High on-time ratings Loyal employees with profit-sharing program The company has also set itself apart through its efficiency and financial strength, with Delta noting the $4.6 billion in free cash flow it generated in 2025 in the JPMorgan presentation. That has separated it from its competitors with an expected free cash flow yield of 9.2% over the next 12 months, according to analysts, far better than its biggest competitors. Delta is the most-loved airline on Wall Street with 26 buy ratings, two holds and zero sell ratings. Analysts also see a 20% rebound from here over the next 12 months, on average. Earlier in the month, Citi Research recommended a buying opportunity in Delta as well, noting it is less sensitive to the move higher in fuel prices. Citi calculates that 75% of Delta's fuel consumption is covered by the company-owned refinery and noted that its industry-leading profit margins will help it weather any shock. The trade The stock has rallied, but it still has more to go and I'd be looking to buy more at a breakout above $72. To be sure, there's risk that an Iran ceasefire does not come to fruition and jet fuel prices return to highs. That could hit the stock again, but remember I'm buying for the long term. DAL YTD mountain Delta, YTD I'm using $56 — where the shares bounced at the height of the turmoil earlier in the month — as my stop. THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. 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