Delta Air Lines Inc (NYSE: DAL) is up nearly 30% versus its year-to-date low but a Morgan Stanley analyst is convinced it will extend its rally further in the coming months.

Ravi Shanker reiterated his “overweight” rating on $DAL this morning that he expects will hit $85 by the end of 2024.

The analyst is super bullish on Delta Air Lines stock primarily because it’s now focusing more on premium services.

He’s convinced the strategic move will boost its earnings and help the flagship airline trade at the upper end of its historical multiple going forward.

Delta Air Lines also currently pays a dividend yield of 0.84% which makes up for another great reason to have it in your investment portfolio.

Delta Air Lines emerged as a stronger business out of the pandemic, as per Ravi Shanker.

He recommends owning $DAL as it’s currently trading below its peak price-to-earnings multiple of 12 times in 2014 even though the airline has significantly improved its earnings and revenue over the ten-year period.

Note that a 12x multiple on the Morgan Stanley analyst’s 2025/2026 earnings estimate could even see Delta Air Lines shares at $110 – more than double their price at writing.