Avanza Fonder AB Invests $1.22 Million in Southwest Airlines Co. $LUV

Key Points

• Avanza Fonder AB has acquired a new position in Southwest Airlines, purchasing 37,724 shares valued at approximately $1.22 million during the second quarter.
• Southwest Airlines announced a $2 billion share buyback plan, indicating the board believes the stock is undervalued.
• The company reported earnings of $0.43 per share for the last quarter, missing expectations, with revenue decreasing by 2.1% compared to the previous year.

Avanza Fonder AB bought a new position in shares of Southwest Airlines Co. (NYSE:LUV - Free Report) in the second quarter, according to the company in its most recent disclosure with the Securities and Exchange Commission (SEC). The institutional investor bought 37,724 shares of the airline's stock, valued at approximately $1,224,000.

Other hedge funds have also made changes to their positions in the company. Pandora Wealth Inc. acquired a new stake in Southwest Airlines during the 1st quarter worth $34,000. Cheviot Value Management LLC acquired a new stake in shares of Southwest Airlines during the 1st quarter valued at approximately $42,000. Quent Capital LLC increased its holdings in shares of Southwest Airlines by 78.6% during the first quarter. Quent Capital LLC now owns 1,472 shares of the airline's stock valued at $49,000 after purchasing an additional 648 shares during the period. Brooklyn Investment Group boosted its stake in Southwest Airlines by 122.3% during the first quarter. Brooklyn Investment Group now owns 1,787 shares of the airline's stock valued at $60,000 after buying an additional 983 shares in the last quarter. Finally, MassMutual Private Wealth & Trust FSB boosted its position in Southwest Airlines by 22.1% during the 1st quarter. MassMutual Private Wealth & Trust FSB now owns 2,161 shares of the airline's stock worth $73,000 after acquiring an additional 391 shares during the period. Institutional investors and hedge funds own 80.82% of the company's stock.

Insider Buying and Selling at Southwest Airlines

In other news, Director Sarah Feinberg bought 1,500 shares of the firm's stock in a transaction dated Tuesday, August 5th. The stock was acquired at an average cost of $30.01 per share, for a total transaction of $45,015.00. Following the completion of the purchase, the director owned 14,229 shares of the company's stock, valued at $427,012.29. This trade represents a 11.78% increase in their ownership of the stock. The acquisition was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, Director Gregg A. Saretsky acquired 3,345 shares of Southwest Airlines stock in a transaction on Wednesday, August 6th. The shares were bought at an average price of $30.03 per share, for a total transaction of $100,450.35. Following the completion of the purchase, the director directly owned 23,644 shares in the company, valued at $710,029.32. The trade was a 16.48% increase in their ownership of the stock. The disclosure for this purchase can be found here. 0.79% of the stock is currently owned by corporate insiders.

Southwest Airlines Stock Down 0.7%

LUV stock traded down $0.24 during midday trading on Monday, hitting $32.28. The company's stock had a trading volume of 10,781,117 shares, compared to its average volume of 8,258,661. The firm has a 50-day simple moving average of $32.30 and a 200-day simple moving average of $31.44. Southwest Airlines Co. has a 52-week low of $23.82 and a 52-week high of $37.96. The company has a quick ratio of 0.49, a current ratio of 0.56 and a debt-to-equity ratio of 0.51. The firm has a market capitalization of $16.95 billion, a P/E ratio of 48.91, a PEG ratio of 0.84 and a beta of 1.19.

Southwest Airlines (NYSE:LUV - Get Free Report) last announced its quarterly earnings results on Wednesday, July 23rd. The airline reported $0.43 EPS for the quarter, missing the consensus estimate of $0.51 by ($0.08). The company had revenue of $7.24 billion for the quarter, compared to analyst estimates of $7.30 billion. Southwest Airlines had a return on equity of 6.27% and a net margin of 1.43%.Southwest Airlines's revenue was down 2.1% compared to the same quarter last year. During the same quarter in the prior year, the business earned $0.58 earnings per share. As a group, equities analysts forecast that Southwest Airlines Co. will post 1.55 EPS for the current year.

Southwest Airlines announced that its board has authorized a share buyback program on Wednesday, July 23rd that allows the company to buyback $2.00 billion in outstanding shares. This buyback authorization allows the airline to reacquire up to 9.4% of its stock through open market purchases. Stock buyback programs are usually a sign that the company's board of directors believes its shares are undervalued.

Southwest Airlines Dividend Announcement

The business also recently declared a quarterly dividend, which will be paid on Wednesday, September 24th. Investors of record on Wednesday, September 3rd will be given a dividend of $0.18 per share. The ex-dividend date of this dividend is Wednesday, September 3rd. This represents a $0.72 annualized dividend and a yield of 2.2%. Southwest Airlines's dividend payout ratio is 109.09%.

Analysts Set New Price Targets

Several equities analysts have recently issued reports on LUV shares. Evercore ISI cut their price target on Southwest Airlines from $40.00 to $34.00 and set an "in-line" rating on the stock in a research note on Friday, July 25th. Susquehanna raised their target price on Southwest Airlines from $25.00 to $30.00 and gave the company a "neutral" rating in a report on Tuesday, August 5th. Hsbc Global Res upgraded Southwest Airlines to a "moderate sell" rating in a research report on Thursday, July 24th. HSBC downgraded Southwest Airlines from a "hold" rating to a "reduce" rating in a report on Thursday, July 24th. Finally, UBS Group raised their price target on Southwest Airlines from $27.00 to $34.00 and gave the stock a "neutral" rating in a research note on Monday, July 7th. Five analysts have rated the stock with a Buy rating, nine have given a Hold rating and four have assigned a Sell rating to the company. According to MarketBeat.com, the stock currently has a consensus rating of "Hold" and a consensus price target of $33.38.

Southwest Airlines Profile

Southwest Airlines Co operates as a passenger airline company that provides scheduled air transportation services in the United States and near-international markets. As of December 31, 2023, the company operated a total fleet of 817 Boeing 737 aircraft; and served 121 destinations in 42 states, the District of Columbia, and the Commonwealth of Puerto Rico, as well as ten near-international countries, including Mexico, Jamaica, the Bahamas, Aruba, the Dominican Republic, Costa Rica, Belize, Cuba, the Cayman Islands, and Turks and Caicos.