Rothschild & Co Redburn Upgrades Southwest Airlines (NYSE:LUV) to "Neutral"

Key Points

• Rothschild & Co Redburn upgraded Southwest Airlines from “sell” to “neutral” and set a $40 price target, implying roughly 0.8% downside from the prior close.
• Analyst sentiment remains mixed but averages “hold”: nine analysts rate the stock a buy, 10 a hold, and three a sell, with an average price target of $48.30.
• Southwest reported quarterly EPS of $0.94, exceeding the $0.52 consensus estimate, while revenue reached $8.72 billion, up 16.4% year over year. Institutional investors own approximately 80.82% of the company.

Southwest Airlines (NYSE:LUV - Get Free Report) was upgraded by analysts at Rothschild & Co Redburn from a "sell" rating to a "neutral" rating in a report released on Friday, Briefing.com reports. The firm currently has a $40.00 target price on the airline's stock. Rothschild & Co Redburn's price target would indicate a potential downside of 0.80% from the company's previous close.

LUV has been the subject of several other reports. Zacks Research upgraded Southwest Airlines from a "strong sell" rating to a "hold" rating in a research note on Thursday, June 25th. Citigroup lowered their price objective on Southwest Airlines from $55.00 to $50.00 and set a "neutral" rating on the stock in a research report on Friday, July 24th. BMO Capital Markets boosted their target price on shares of Southwest Airlines from $58.50 to $60.00 and gave the company an "outperform" rating in a research report on Friday, July 24th. Jefferies Financial Group upped their price target on shares of Southwest Airlines from $44.00 to $50.00 and gave the company a "hold" rating in a research note on Wednesday, July 1st. Finally, Weiss Ratings raised shares of Southwest Airlines from a "hold (c)" rating to a "hold (c+)" rating in a research report on Tuesday, August 18th. Nine investment analysts have rated the stock with a Buy rating, ten have issued a Hold rating and three have issued a Sell rating to the stock. According to data from MarketBeat.com, the stock has an average rating of "Hold" and an average price target of $48.30.

Southwest Airlines Stock Performance

Shares of LUV stock opened at $40.32 on Friday. The company has a market capitalization of $19.73 billion, a price-to-earnings ratio of 24.74, a PEG ratio of 0.36 and a beta of 1.13. The company has a debt-to-equity ratio of 0.54, a quick ratio of 0.42 and a current ratio of 0.49. Southwest Airlines has a 52 week low of $29.26 and a 52 week high of $55.11. The company has a 50-day simple moving average of $43.41 and a 200 day simple moving average of $42.81.

Southwest Airlines (NYSE:LUV - Get Free Report) last issued its quarterly earnings data on Wednesday, July 22nd. The airline reported $0.94 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.52 by $0.42. Southwest Airlines had a net margin of 2.78% and a return on equity of 14.15%. The firm had revenue of $8.72 billion during the quarter, compared to the consensus estimate of $8.58 billion. During the same period last year, the business posted $0.43 earnings per share. The business's revenue for the quarter was up 16.4% compared to the same quarter last year. Southwest Airlines has set its FY 2026 guidance at 3.250-4.250 EPS and its Q3 2026 guidance at 0.500-0.750 EPS. On average, sell-side analysts predict that Southwest Airlines will post 3.28 earnings per share for the current year.

Institutional Inflows and Outflows

A number of hedge funds and other institutional investors have recently bought and sold shares of the stock. MCF Advisors LLC raised its position in shares of Southwest Airlines by 28.5% in the 4th quarter. MCF Advisors LLC now owns 915 shares of the airline's stock valued at $38,000 after purchasing an additional 203 shares during the last quarter. Annis Gardner Whiting Capital Advisors LLC grew its position in Southwest Airlines by 1.5% during the 4th quarter. Annis Gardner Whiting Capital Advisors LLC now owns 16,437 shares of the airline's stock worth $682,000 after purchasing an additional 235 shares during the last quarter. Greenleaf Trust grew its position in Southwest Airlines by 4.0% during the 2nd quarter. Greenleaf Trust now owns 8,015 shares of the airline's stock worth $412,000 after purchasing an additional 311 shares during the last quarter. Grove Bank & Trust increased its stake in Southwest Airlines by 109.4% during the 2nd quarter. Grove Bank & Trust now owns 871 shares of the airline's stock valued at $45,000 after purchasing an additional 455 shares in the last quarter. Finally, Resona Asset Management Co. Ltd. raised its holdings in shares of Southwest Airlines by 8.0% in the first quarter. Resona Asset Management Co. Ltd. now owns 6,738 shares of the airline's stock worth $245,000 after buying an additional 498 shares during the last quarter. Institutional investors and hedge funds own 80.82% of the company's stock.

About Southwest Airlines

Southwest Airlines Co is a major U.S. passenger airline headquartered in Dallas, Texas. Operating under the Southwest Airlines brand, the company provides scheduled air transportation for domestic and international travelers and also offers air cargo services.

Southwest was founded in 1967 and began commercial service in 1971, initially connecting Dallas, Houston and San Antonio. The airline expanded its network across the United States and now serves numerous destinations in the United States, Mexico, the Caribbean, Central America and other nearby international markets.

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