Rafferty Asset Management LLC Sells 16,702 Shares of Southwest Airlines Co. $LUV

Key Points

• Rafferty Asset Management LLC reduced its holdings in Southwest Airlines by 22.5%, owning 57,685 shares valued at approximately $1.94 million after selling 16,702 shares during the 1st quarter.
• Southwest Airlines reported a missed earnings estimate for its latest quarter, with earnings per share of $0.43 compared to the consensus estimate of $0.51, alongside a revenue of $7.24 billion which fell short of the expected $7.30 billion.
• The board announced a $2 billion share buyback plan, which suggests confidence in the stock's undervaluation, and is set to repurchase up to 9.4% of outstanding shares.

Rafferty Asset Management LLC lessened its position in Southwest Airlines Co. (NYSE:LUV - Free Report) by 22.5% during the 1st quarter, according to its most recent filing with the Securities and Exchange Commission (SEC). The firm owned 57,685 shares of the airline's stock after selling 16,702 shares during the quarter. Rafferty Asset Management LLC's holdings in Southwest Airlines were worth $1,937,000 at the end of the most recent quarter.

Several other institutional investors have also recently bought and sold shares of the company. Primecap Management Co. CA raised its holdings in 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 acquiring an additional 788,255 shares during the period. Jacobs Levy Equity Management Inc. raised its holdings in 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 acquiring an additional 2,391,495 shares during the period. Charles Schwab Investment Management Inc. raised its holdings in Southwest Airlines by 3.9% in the 1st quarter. Charles Schwab Investment Management Inc. now owns 3,602,939 shares of the airline's stock worth $120,987,000 after acquiring an additional 136,410 shares during the period. Sound Shore Management Inc. CT raised its holdings in Southwest Airlines by 12.7% in the 1st quarter. Sound Shore Management Inc. CT now owns 2,857,308 shares of the airline's stock worth $95,948,000 after acquiring an additional 321,258 shares during the period. Finally, Nuveen LLC bought a new position in Southwest Airlines in the 1st quarter worth $50,433,000. Institutional investors own 80.82% of the company's stock.

Analyst Ratings Changes

LUV has been the topic of several research reports. Jefferies Financial Group upgraded shares of Southwest Airlines from an "underperform" rating to a "hold" rating and boosted their price objective for the stock from $24.00 to $33.00 in a report on Tuesday, May 27th. Barclays boosted 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. Hsbc Global Res upgraded shares of Southwest Airlines to a "moderate sell" rating in a report on Thursday, July 24th. Susquehanna boosted their price objective on shares of Southwest Airlines from $25.00 to $30.00 and gave the stock a "neutral" rating in a report on Tuesday, August 5th. Finally, HSBC downgraded shares of Southwest Airlines from a "hold" rating to a "reduce" rating in a report on Thursday, July 24th. Four investment analysts have rated the stock with a Buy rating, nine have issued a Hold rating and six have assigned a Sell rating to the company. According to MarketBeat.com, Southwest Airlines presently has an average rating of "Reduce" and an average target price of $33.06.

Insider Transactions at Southwest Airlines

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

Southwest Airlines Price Performance

Shares of Southwest Airlines stock traded up $0.08 during trading on Wednesday, hitting $32.33. 4,304,148 shares of the company's stock traded hands, compared to its average volume of 11,435,337. The company has a debt-to-equity ratio of 0.51, a current ratio of 0.56 and a quick ratio of 0.49. The firm's fifty day moving average price is $32.96 and its 200 day moving average price is $31.28. Southwest Airlines Co. has a twelve month low of $23.82 and a twelve month high of $37.96. The company has a market cap of $16.98 billion, a PE ratio of 48.98, a PEG ratio of 0.85 and a beta of 1.19.

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

Southwest Airlines Announces Dividend

The company also recently declared 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 is Wednesday, September 3rd. This represents a $0.72 dividend on an annualized basis and a yield of 2.2%. Southwest Airlines's payout ratio is 109.09%.

Southwest Airlines declared that its board has approved a share buyback plan on Wednesday, July 23rd that permits the company to repurchase $2.00 billion in outstanding shares. This repurchase authorization permits the airline to purchase up to 9.4% of its stock through open market purchases. Stock repurchase plans are typically an indication that the company's leadership believes its shares are undervalued.

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.