Southwest Airlines Co. (NYSE:LUV) Receives Consensus Recommendation of "Hold" from Analysts

Key Points

• Analysts have a consensus “Hold” rating on Southwest Airlines, with 22 firms split among four sells, nine holds and nine buys. The average 12-month price target is $48.06.
• Southwest reported quarterly EPS of $0.94, well above the $0.52 consensus estimate, while revenue rose 16.4% year over year to $8.72 billion.
• Institutional investors own 80.82% of the company, and Southwest declared a quarterly dividend of $0.18 per share, equivalent to a 1.8% annualized yield.

Southwest Airlines Co. (NYSE:LUV - Get Free Report) has been assigned a consensus recommendation of "Hold" from the twenty-two brokerages that are covering the stock, MarketBeat reports. Four investment analysts have rated the stock with a sell recommendation, nine have given a hold recommendation and nine have assigned a buy recommendation to the company. The average 1-year target price among analysts that have covered the stock in the last year is $48.0550.

A number of equities research analysts recently weighed in on LUV shares. Bank of America increased their price target on Southwest Airlines from $40.00 to $45.00 and gave the company an "underperform" rating in a research note on Wednesday, July 1st. JPMorgan Chase & Co. decreased their price objective on shares of Southwest Airlines from $60.00 to $59.00 and set an "overweight" rating on the stock in a report on Friday, July 24th. Jefferies Financial Group upped their price objective on shares of Southwest Airlines from $44.00 to $50.00 and gave the company a "hold" rating in a report on Wednesday, July 1st. Evercore raised their target price on shares of Southwest Airlines from $44.00 to $52.00 in a research note on Thursday, June 25th. Finally, Wall Street Zen downgraded shares of Southwest Airlines from a "buy" rating to a "hold" rating in a report on Saturday, September 5th.

Hedge Funds Weigh In On Southwest Airlines

Institutional investors and hedge funds have recently made changes to their positions in the company. WINTON GROUP Ltd increased its stake in shares of Southwest Airlines by 218.8% during the second quarter. WINTON GROUP Ltd now owns 93,837 shares of the airline's stock worth $4,825,000 after purchasing an additional 64,402 shares during the period. Engineers Gate Manager LP boosted its stake in Southwest Airlines by 75.1% in the 2nd quarter. Engineers Gate Manager LP now owns 814,820 shares of the airline's stock valued at $41,898,000 after purchasing an additional 349,394 shares during the period. RFG Advisory LLC boosted its stake in Southwest Airlines by 8.7% in the 2nd quarter. RFG Advisory LLC now owns 22,992 shares of the airline's stock valued at $1,182,000 after purchasing an additional 1,836 shares during the period. NewEdge Advisors LLC grew its holdings in Southwest Airlines by 10.5% in the 2nd quarter. NewEdge Advisors LLC now owns 140,652 shares of the airline's stock valued at $7,232,000 after buying an additional 13,321 shares in the last quarter. Finally, IFP Advisors Inc grew its holdings in Southwest Airlines by 22.8% in the 2nd quarter. IFP Advisors Inc now owns 10,339 shares of the airline's stock valued at $532,000 after buying an additional 1,923 shares in the last quarter. Institutional investors and hedge funds own 80.82% of the company's stock.

Trending Headlines about Southwest Airlines

Here are the key news stories impacting Southwest Airlines this week:

• Positive Sentiment: Southwest said it expects to meet its third-quarter profit target despite higher fuel costs, suggesting resilient travel demand, pricing power and cost controls may offset some of the margin pressure. Southwest Airlines expects to meet Q3 profit goal despite higher fuel costs
• Positive Sentiment: Southwest’s planned airport lounges and 2027 premium co-branded credit card with JPMorgan Chase could create new high-margin loyalty and ancillary-revenue streams while strengthening the airline’s appeal to premium travelers. The first lounges are planned for Austin, Baltimore, Honolulu and Nashville. Southwest finally joins the lounge business
• Positive Sentiment: Higher airfares across the industry, driven by elevated fuel and labor expenses, could help Southwest recover increased operating costs if demand remains solid. Airline industry continues to witness higher air fares
• Neutral Sentiment: Southwest presented at Morgan Stanley’s Laguna Conference, giving investors an update on strategy and outlook. Recent weakness in the shares has raised questions about valuation, but the event itself provided no clearly stated material change in fundamentals. Southwest Airlines Morgan Stanley conference transcript
• Negative Sentiment: Jet-fuel prices are squeezing Southwest and other major airlines, prompting carriers to cut flights and trim lower-priced capacity. Reduced flying could limit revenue growth, while higher fuel costs threaten profitability if fare increases do not fully offset them. Major airlines cut flights as higher jet fuel prices hit carriers

Southwest Airlines Stock Up 3.0%

Southwest Airlines stock opened at $40.32 on Friday. The firm has a market capitalization of $19.73 billion, a PE ratio of 24.74, a P/E/G ratio of 0.36 and a beta of 1.13. The company's 50-day moving average is $43.41 and its 200-day moving average is $42.81. Southwest Airlines has a fifty-two week low of $29.26 and a fifty-two week high of $55.11. The company has a debt-to-equity ratio of 0.54, a current ratio of 0.49 and a quick ratio of 0.42.

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

Southwest Airlines Announces Dividend

The business also recently disclosed a quarterly dividend, which will be paid on Thursday, September 24th. Shareholders of record on Thursday, September 3rd will be given a dividend of $0.18 per share. The ex-dividend date is Thursday, September 3rd. This represents a $0.72 annualized dividend and a yield of 1.8%. Southwest Airlines's dividend payout ratio (DPR) is 44.17%.

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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