Delta (not just the airline)
The economy is opening up again, and with the jumpstart in a big demand for goods and services, companies are seeing a surge in business. That’s the good news.
Unfortunately, we are now in the midst of a new strain of COVID, the “delta variant” which has become the most prevalent strain of new COVID cases in America. But to be clear, the science has shown that folks who have been fully vaccinated have a low risk of being infected, or even carriers, of this new strain.
We saw, during this earnings quarter, quite a few companies outstrip their estimates as demand returned for a lot of things, as Americans are itching to get back to some sort of normalcy in their lives. And, equally, we have seen some demand outstrip the supply for certain goods (microchips, other tech) which will only drive demand higher, and therefore, profits for companies in that sector.
Given that MONTAG is in Atlanta, we have to say that the “other” Delta, that is Delta Air Lines, Inc. [NYSE: DAL] has exhibited the same sort of demand as people are eager to take vacations. While travel restrictions stay in place for certain destinations, Delta Air Lines is a good (local) proxy for what demand looks like for the American public when it comes to consumption of goods, and there is a lot of demand there. Similarly, as my partner Larry Mendel says, the return of consumers means “I can’t even go to McDonalds without there being a line.”
Be safe, and vigilant, but don’t let the Delta strain intimidate you.
The information provided is for illustration purposes only. It is not, and should not be regarded as “investment advice” or as a “recommendation” regarding a course of action to be taken. These analyses have been produced using data provided by third parties and/or public sources. While the information is believed to be reliable, its accuracy cannot be guaranteed.
Any securities identified were selected for illustrative purposes only. Specific securities identified and described may or may not be held in portfolios managed by the Adviser and do not represent all of the securities purchased, sold, or recommended for advisory clients. The reader should not assume that investments in the securities identified and discussed were or will be profitable.