UBS Group Issues Pessimistic Forecast for Southwest Airlines (NYSE:LUV) Stock Price

Key Points

• UBS Group lowered Southwest Airlines’ price target from $56 to $49 while maintaining a “buy” rating, implying 27.54% upside from the prior close.
• Analyst sentiment is mixed: Southwest has a consensus “hold” rating from 22 analysts, with an average price target of $48.41.
• Southwest shares fell 0.7% to $38.42, despite the airline beating quarterly earnings and revenue estimates with $0.94 EPS and $8.72 billion in revenue.

Southwest Airlines (NYSE:LUV - Get Free Report) had its target price cut by UBS Group from $56.00 to $49.00 in a report released on Thursday, Benzinga reports. The brokerage presently has a "buy" rating on the airline's stock. UBS Group's target price indicates a potential upside of 27.54% from the company's previous close.

Several other equities research analysts also recently weighed in on the stock. Citigroup decreased their price target on shares of Southwest Airlines from $55.00 to $50.00 and set a "neutral" rating for the company in a research note on Friday, July 24th. Wells Fargo & Company increased their price target on Southwest Airlines from $44.00 to $50.00 and gave the stock an "equal weight" rating in a report on Tuesday, June 30th. Raymond James Financial decreased their price objective on shares of Southwest Airlines from $60.00 to $54.00 and set an "outperform" rating for the company in a research note on Monday, August 24th. The Goldman Sachs Group boosted their target price on shares of Southwest Airlines from $30.00 to $35.00 and gave the company a "sell" rating in a research note on Thursday, July 2nd. Finally, Barclays increased their target price on shares of Southwest Airlines from $56.00 to $65.00 and gave the company an "overweight" rating in a research report on Thursday, June 25th. Nine investment analysts have rated the stock with a Buy rating, nine have given a Hold rating and four have issued a Sell rating to the stock. According to MarketBeat.com, the stock currently has a consensus rating of "Hold" and an average price target of $48.41.

Southwest Airlines Trading Down 0.7%

NYSE:LUV traded down $0.26 during trading hours on Thursday, hitting $38.42. 315,436 shares of the company were exchanged, compared to its average volume of 7,541,734. The stock has a market capitalization of $18.79 billion, a price-to-earnings ratio of 23.55, a price-to-earnings-growth ratio of 0.36 and a beta of 1.13. The company has a current ratio of 0.49, a quick ratio of 0.42 and a debt-to-equity ratio of 0.54. Southwest Airlines has a one year low of $29.26 and a one year high of $55.11. The company has a fifty day simple moving average of $44.66 and a 200 day simple moving average of $43.28.

Southwest Airlines (NYSE:LUV - Get Free Report) last posted its quarterly earnings data on Wednesday, July 22nd. The airline reported $0.94 EPS for the quarter, topping analysts' consensus estimates of $0.52 by $0.42. The company had revenue of $8.72 billion for the quarter, compared to analyst estimates of $8.58 billion. Southwest Airlines had a return on equity of 14.15% and a net margin of 2.78%.The firm's quarterly revenue was up 16.4% on a year-over-year basis. During the same period in the previous year, the firm earned $0.43 earnings per share. 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. Sell-side analysts expect that Southwest Airlines will post 3.28 EPS for the current fiscal year.

Institutional Trading of Southwest Airlines

A number of institutional investors have recently added to or reduced their stakes in the stock. SHP Wealth Management bought a new stake in shares of Southwest Airlines during the fourth quarter valued at about $25,000. Entrust Financial LLC purchased a new position in Southwest Airlines during the fourth quarter valued at approximately $26,000. Los Angeles Capital Management LLC bought a new stake in Southwest Airlines during the 4th quarter worth approximately $26,000. Scarborough Advisors LLC bought a new stake in Southwest Airlines during the 1st quarter worth approximately $28,000. Finally, DV Equities LLC purchased a new stake in Southwest Airlines in the 4th quarter worth approximately $30,000. Hedge funds and other institutional investors 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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