10:44 AM EDT, 10/11/2024 (MT Newswires) -- Delta Air Lines ( DAL ) Q3 earnings came short of expectations due to Hurricane Helene and disruptions from the Crowdstrike ( CRWD ) outage and management believes that without these events it would have achieved the high end of its outlook, Morgan Stanley said in a note on Friday.

The company issued downbeat Q4 guidance due to uncertainty from another hurricane and the upcoming US presidential election, however it remains optimistic about improvement in demand starting mid-November into 2025, according to the note.

Morgan Stanley said that Delta's domestic and transatlantic routes performed particularly well in Q3, with unit revenue growth accelerating and the transatlantic region expected to be a strong performer in the winter.

The full financial impact of flight cancellations and operational disruptions caused by Hurricane Milton remains unclear, the investment firm said.

"We continue to expect the fall investor day to be an important catalyst... with new long-term financial targets and momentum into 2025," the note added.

Morgan Stanley reiterated its overweight rating on Delta's stock and kept the price target at $85.

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