Howard Capital Management Inc. Sells 10,274 Shares of Southwest Airlines Co. (NYSE:LUV)

Key Points

• Howard Capital Management Inc. reduced its holdings in Southwest Airlines by 8.0% in Q1 after selling 10,274 shares, bringing its ownership down to 117,479 shares worth approximately $3.94 million.
• Southwest Airlines' recent earnings report revealed a $0.43 EPS, missing the consensus estimate of $0.51, with revenues of $7.24 billion compared to an expected $7.30 billion.
• The airline announced a $2.00 billion stock buyback plan, allowing repurchase of up to 9.4% of its shares, which typically indicates the board's belief that the stock is undervalued.

Howard Capital Management Inc. trimmed its holdings in shares of Southwest Airlines Co. (NYSE:LUV - Free Report) by 8.0% in the 1st quarter, according to the company in its most recent disclosure with the Securities & Exchange Commission. The firm owned 117,479 shares of the airline's stock after selling 10,274 shares during the period. Howard Capital Management Inc.'s holdings in Southwest Airlines were worth $3,945,000 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. Quent Capital LLC increased its stake in Southwest Airlines by 78.6% in the 1st quarter. Quent Capital LLC now owns 1,472 shares of the airline's stock worth $49,000 after purchasing an additional 648 shares during the period. Optiver Holding B.V. grew its holdings in shares of Southwest Airlines by 370.3% in the fourth quarter. Optiver Holding B.V. now owns 1,919 shares of the airline's stock worth $65,000 after purchasing an additional 1,511 shares during the last quarter. MassMutual Private Wealth & Trust FSB increased its stake in shares of Southwest Airlines by 22.1% in the first quarter. MassMutual Private Wealth & Trust FSB now owns 2,161 shares of the airline's stock worth $73,000 after buying an additional 391 shares during the period. Golden State Wealth Management LLC raised its holdings in Southwest Airlines by 35.7% during the 1st quarter. Golden State Wealth Management LLC now owns 2,590 shares of the airline's stock valued at $87,000 after buying an additional 681 shares during the last quarter. Finally, Bartlett & CO. Wealth Management LLC raised its holdings in Southwest Airlines by 23.3% during the 1st quarter. Bartlett & CO. Wealth Management LLC now owns 2,659 shares of the airline's stock valued at $90,000 after buying an additional 503 shares during the last quarter. 80.82% of the stock is owned by institutional investors.

Southwest Airlines Stock Down 3.6%

Shares of LUV stock traded down $1.12 during trading hours on Friday, hitting $29.81. 12,569,951 shares of the company's stock traded hands, compared to its average volume of 13,055,449. 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 stock's fifty day simple moving average is $33.47 and its two-hundred day simple moving average is $31.30. Southwest Airlines Co. has a 12-month low of $23.58 and a 12-month high of $37.96. The stock has a market cap of $15.66 billion, a price-to-earnings ratio of 45.17, a PEG ratio of 0.77 and a beta of 1.26.

Southwest Airlines (NYSE:LUV - Get Free Report) last posted its quarterly earnings results on Wednesday, July 23rd. The airline reported $0.43 earnings per share (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 analysts' expectations 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 for the quarter was down 2.1% compared to the same quarter last year. During the same period in the prior year, the firm earned $0.58 EPS. On average, analysts expect that Southwest Airlines Co. will post 1.55 EPS for the current year.

Southwest Airlines announced that its Board of Directors has approved a share repurchase program on Wednesday, July 23rd that authorizes the company to repurchase $2.00 billion in shares. This repurchase authorization authorizes the airline to repurchase up to 9.4% of its stock through open market purchases. Stock repurchase programs are usually a sign that the company's leadership believes its stock is undervalued.

Southwest Airlines Announces Dividend

The firm also recently announced a quarterly dividend, which will be paid on Wednesday, September 24th. Shareholders of record on Wednesday, September 3rd will be given a $0.18 dividend. The ex-dividend date of this dividend is Wednesday, September 3rd. This represents a $0.72 dividend on an annualized basis and a yield of 2.4%. Southwest Airlines's payout ratio is 109.09%.

Analysts Set New Price Targets

A number of research analysts recently issued reports on LUV shares. Susquehanna reduced their price target on Southwest Airlines from $34.00 to $25.00 and set a "neutral" rating on the stock in a report on Monday, April 7th. Wall Street Zen cut Southwest Airlines from a "hold" rating to a "sell" rating in a research note on Saturday, July 26th. Jefferies Financial Group raised Southwest Airlines from an "underperform" rating to a "hold" rating and raised their price target for the stock from $24.00 to $33.00 in a research note on Tuesday, May 27th. Deutsche Bank Aktiengesellschaft upgraded shares of Southwest Airlines from a "hold" rating to a "buy" rating and set a $40.00 price target on the stock in a report on Thursday, May 29th. Finally, Barclays upped their price objective on shares of Southwest Airlines from $26.00 to $34.00 and gave the stock an "equal weight" rating in a report on Thursday, July 10th. Seven investment analysts have rated the stock with a sell rating, nine have given a hold rating and four have issued a buy rating to the company's stock. Based on data from MarketBeat, Southwest Airlines presently has an average rating of "Hold" and an average target price of $32.75.

About Southwest Airlines

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.