01:03 PM EDT, 07/09/2024 (MT Newswires) -- Delta Air Lines ( DAL ) may point to the higher-end of its full-year earnings guidance this week as its mix of premium clients could help offset domestic revenue weakness driven by lower-end consumers, BofA Securities said in a note emailed Tuesday.

The carrier will set the tone for the airline earnings season when it reports results for the second quarter and provides a third-quarter guidance on Thursday.

With Delta's shares down 12% since peaking in mid-May, there is "clearly skittishness around domestic capacity, promotional activity, and negative guidance revisions from" American Airlines ( AAL ) and Southwest Airlines ( LUV ) in the last few weeks, BofA analyst Andrew Didora wrote.

Delta isn't immune to industry dynamics, but Didora said the airline's premium, corporate and international exposures should help it "navigate these issues better than others." BofA reiterated a buy rating and a $55 price objective on the stock. Delta's shares were up 1.8% in midday trade.

The brokerage raised its second-quarter earnings per share target to $2.41 from $2.25, compared with Wall Street's $2.37 view and at the higher end of the airline's guidance. Lower fuel costs was the key driver of the EPS change as BofA's revenue growth forecast of 5.6% is in the lower half of Delta's guidance, the report showed.

Delta is expected to reiterate its $6 to $7 2024 EPS guide "with commentary towards the higher end" as premium and corporate have proven more resilient than the lower-end consumer, Didora said. The brokerage lowered its 2024 EPS estimate to $6.67 from $6.81, staying above the consensus' $6.61.

For the third quarter, BofA's EPS estimate was reduced to $2.10 from $2.13, remaining above the Visible Alpha consensus of $2.07 on total revenue growth of 5.2%.

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