2Q26 US Airlines Preview

Research evidence excerpt

2Q26 US Airlines Preview

TD SECURITIES (USA) LLC INDUSTRY UPDATE

July 2, 2026

■Airlines 2Q26 US Airlines Preview

Tom Fitzgerald, CFA THE TD COWEN INSIGHT

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2Q26 earnings season lifts off with DAL on 7/10. We remain broadly constructive, assuming the

tom.fitzgerald@tdsecurities.com

industry hangs on to this year's price increases. Our 2Q estimates are broadly in line except

Price Target Changes for ALK and SKYW. Our 3Q estimates are above consensus for DAL, UAL, AAL, LUV, and ALK.

AAL $24.00 (Prior $20.00) Investors likely need confirmation post-Labor Day that pricing is holding & demand still robust

ALK $59.00 (Prior $51.00) for shares to extend gains.

DAL $106.00 (Prior $92.00)

LUV $53.00 (Prior $47.00) Earnings season returns with Delta's results on 7/10. United will follow on 7/15 with LUV the

SKYW $115.00 (Prior $98.00)

following week. We expect ALK, AAL, and SKYW to also report the week of 7/20 with JBLU the

UAL $176.00 (Prior $150.00)

week of 7/28.

We maintain all our prior ratings and update our price targets as follows: Delta to $106 (~13x

2027E adj EPS), United to $176 (~11x 2027E adj EPS), American to $24 (5.5x 2027E EV/EBITDAR),

Southwest to $53 (~10.5x 2027E adj EPS), Alaska to $59 (~9.5x 2027E adj EPS), and SkyWest to

$115 (~10x 2027E adj EPS). JetBlue remains at $5.00 (8.1x 2027E EV/EBITDAR).

All things considered, the quarter has played out about as well as it could have for the

industry. Spirit liquidated. Pricing looks robust across most markets with demand elasticity

much better than expected. Jet fuel pricing has come down materially since late May.

Our estimates for 2Q26 are about in line for Delta, United, and JetBlue. We are slightly above

consensus for American and Southwest. We are below consensus for Alaska (primarily on