Delta Air Lines Stock Sags After Disappointing Q3 Report

Shares of Delta Air Lines, Inc. (NYSE:DAL) are 3.3% lower before the opening bell, following the company's third-quarter earnings report. Not only did the airline giant report quarterly earnings and revenue that missed the mark, it provided a gloomy fourth-quarter revenue guidance on expectations of lower demand before and after the U.S. Presidential Election.

Today's dip looks like it will cut into the stock's 26.7% year-to-date lead. After a May 13 four-year peak of $53.86, the shares cooled off in the summer, trading down into $37.32 on Aug. 7, an area of familiar lows from early 2024. DAL executed a quick V-shaped rally from there, though, and given last night's close at $50.98, it will be interesting to see if the round $50 level steps up as support in today's session. 

Puts have outpaced calls lately. This is per the airline stock's 50-day put/call volume ratio at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) that sits higher than 97% of annual readings. Echoing this, DAL's 10-day put/call volume ratio at the ISE, CBOE, and PHLX stands in the 87th percentile of annual readings.

It's also worth noting  the equity's Schaeffer's Volatility Scorecard (SVS) sits at a high 98 out of 100. This means DAL exceeded option traders' volatility expectations in the past 12 months. If options become cheaper in a post-earnings volatility crunch, premium buying could be the way to go.