Delta Air Lines Boosts Dividend 50%, Sets New $5 Billion Buyback Program

Delta Air Lines Inc. said at a meeting with analysts Thursday that it will raise its dividend by 50% to an annual rate of $1.22 a share from 81 cents a share, starting the September quarter. At Wednesday's stock closing price of $49.97, the new dividend would imply a 2.44% dividend yield, compared with the aggregate yield for the S&P 500 of 2.01%, according to FactSet. Delta said it authorized a new $5 billion share repurchase program, to be completed by June 2020, and to begin when the previous $5 billion program started in 2015 is completed. The air carrier it remains committed to capping its 2017 system capacity growth at 1%, and that it expects to resume margin expansion in the second quarter after absorbing all the margin headwinds during the first quarter. The stock, which edged up 0.4% in premarket trade, has ticked up 1.6% year to date through Wednesday, while the NYSE Arca Airline Index has gained 3.8% and the S&P 500 has rallied 7.2%.