Federation des caisses Desjardins du Quebec Boosts Stock Position in Southwest Airlines Co. $LUV

Key Points

• The Federation des caisses Desjardins du Quebec increased its stake in Southwest Airlines by 96.8%, bringing its total ownership to approximately $11.29 million in shares.
• Southwest Airlines reported a net margin of 1.43% and earnings per share (EPS) of $0.43, missing the consensus estimate of $0.51 by $0.08.
• The airline has initiated a $2.00 billion stock repurchase program, which represents an intention that shares may be undervalued according to its board.

Federation des caisses Desjardins du Quebec lifted its stake in Southwest Airlines Co. (NYSE:LUV - Free Report) by 96.8% in the first quarter, according to the company in its most recent 13F filing with the SEC. The firm owned 336,052 shares of the airline's stock after purchasing an additional 165,305 shares during the quarter. Federation des caisses Desjardins du Quebec owned about 0.06% of Southwest Airlines worth $11,293,000 at the end of the most recent reporting period.

A number of other institutional investors and hedge funds have also recently modified their holdings of LUV. Jacobs Levy Equity Management Inc. boosted its holdings in shares of Southwest Airlines by 66.0% in the 4th quarter. Jacobs Levy Equity Management Inc. now owns 6,014,828 shares of the airline's stock worth $202,219,000 after purchasing an additional 2,391,495 shares during the period. Nuveen LLC purchased a new position in shares of Southwest Airlines in the 1st quarter worth approximately $50,433,000. Jefferies Financial Group Inc. boosted its holdings in shares of Southwest Airlines by 2,857.9% in the 4th quarter. Jefferies Financial Group Inc. now owns 1,013,657 shares of the airline's stock worth $34,079,000 after purchasing an additional 979,388 shares during the period. Primecap Management Co. CA boosted its holdings in shares of Southwest Airlines by 1.6% in the 1st quarter. Primecap Management Co. CA now owns 49,688,308 shares of the airline's stock worth $1,668,533,000 after purchasing an additional 788,255 shares during the period. Finally, WS Management Lllp bought a new position in Southwest Airlines in the 4th quarter valued at $20,172,000. Hedge funds and other institutional investors own 80.82% of the company's stock.

Insider Buying and Selling at Southwest Airlines

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

Analyst Ratings Changes

Several equities analysts have commented on LUV shares. Hsbc Global Res raised Southwest Airlines to a "moderate sell" rating in a research report on Thursday, July 24th. Barclays upped their price objective on Southwest Airlines from $26.00 to $34.00 and gave the company an "equal weight" rating in a research report on Thursday, July 10th. Susquehanna upped their price objective on Southwest Airlines from $25.00 to $30.00 and gave the company a "neutral" rating in a research report on Tuesday, August 5th. Evercore ISI cut their price objective on Southwest Airlines from $40.00 to $34.00 and set an "in-line" rating on the stock in a research report on Friday, July 25th. Finally, HSBC downgraded Southwest Airlines from a "hold" rating to a "reduce" rating in a research report on Thursday, July 24th. Four equities research analysts have rated the stock with a Buy rating, nine have issued a Hold rating and six have issued a Sell rating to the company. Based on data from MarketBeat.com, Southwest Airlines presently has a consensus rating of "Reduce" and a consensus price target of $33.06.

Southwest Airlines Stock Up 0.8%

Shares of LUV stock traded up $0.24 during mid-day trading on Friday, hitting $31.36. The stock had a trading volume of 8,026,881 shares, compared to its average volume of 6,645,707. Southwest Airlines Co. has a 12-month low of $23.82 and a 12-month high of $37.96. The firm has a market capitalization of $16.47 billion, a P/E ratio of 47.52, a price-to-earnings-growth ratio of 0.81 and a beta of 1.19. The firm's 50-day moving average is $32.96 and its two-hundred day moving average is $31.30. The company has a debt-to-equity ratio of 0.51, a current ratio of 0.56 and a quick ratio of 0.49.

Southwest Airlines (NYSE:LUV - Get Free Report) last released 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 during the quarter, compared to the consensus estimate of $7.30 billion. Southwest Airlines had a return on equity of 6.27% and a net margin of 1.43%.The company's revenue was down 2.1% on a year-over-year basis. During the same period in the previous year, the firm posted $0.58 earnings per share. On average, analysts predict that Southwest Airlines Co. will post 1.55 earnings per share for the current fiscal year.

Southwest Airlines declared that its Board of Directors has initiated a stock buyback plan on Wednesday, July 23rd that allows the company to buyback $2.00 billion in outstanding shares. This buyback authorization allows the airline to purchase up to 9.4% of its shares through open market purchases. Shares buyback plans are often a sign that the company's board of directors believes its stock is undervalued.

Southwest Airlines Dividend Announcement

The business also recently declared a quarterly dividend, which will be paid on Wednesday, September 24th. Stockholders of record on Wednesday, September 3rd will be given a $0.18 dividend. This represents a $0.72 annualized dividend and a dividend yield of 2.3%. The ex-dividend date of this dividend is Wednesday, September 3rd. Southwest Airlines's payout ratio is presently 109.09%.

Southwest Airlines Company 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.