Southwest Airlines Co. (NYSE:LUV) Plans $0.18 Quarterly Dividend

Key Points

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Southwest Airlines Co. (NYSE:LUV - Get Free Report) declared a quarterly dividend on Thursday, July 31st, RTT News reports. Investors of record on Wednesday, September 3rd will be given a dividend of 0.18 per share by the airline on Wednesday, September 24th. This represents a $0.72 dividend on an annualized basis and a yield of 2.36%.

Southwest Airlines has a dividend payout ratio of 28.8% meaning its dividend is sufficiently covered by earnings. Research analysts expect Southwest Airlines to earn $2.36 per share next year, which means the company should continue to be able to cover its $0.72 annual dividend with an expected future payout ratio of 30.5%.

Southwest Airlines Stock Performance

LUV stock traded down $0.19 during midday trading on Thursday, hitting $30.53. 2,229,909 shares of the company traded hands, compared to its average volume of 12,025,081. Southwest Airlines has a twelve month low of $23.58 and a twelve month 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 business has a 50 day simple moving average of $33.48 and a 200-day simple moving average of $31.31. The stock has a market capitalization of $16.03 billion, a price-to-earnings ratio of 46.22, a price-to-earnings-growth ratio of 0.78 and a beta of 1.21.

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 net margin of 1.43% and a return on equity of 6.27%. The company's revenue for the quarter was down 2.1% on a year-over-year basis. During the same quarter last year, the business earned $0.58 EPS. As a group, equities research analysts predict that Southwest Airlines will post 1.55 earnings per share for the current year.

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

Hedge Funds Weigh In On Southwest Airlines

Several institutional investors have recently modified their holdings of LUV. Empowered Funds LLC increased its position in shares of Southwest Airlines by 7.6% during the 1st quarter. Empowered Funds LLC now owns 7,459 shares of the airline's stock valued at $250,000 after purchasing an additional 527 shares during the last quarter. AQR Capital Management LLC lifted its stake in shares of Southwest Airlines by 100.6% in the 1st quarter. AQR Capital Management LLC now owns 39,347 shares of the airline's stock valued at $1,303,000 after purchasing an additional 19,729 shares during the period. Finally, MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. lifted its stake in shares of Southwest Airlines by 5.4% in the 1st quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. now owns 61,060 shares of the airline's stock valued at $2,050,000 after purchasing an additional 3,141 shares during the period. 80.82% of the stock is currently owned by institutional investors.

Analysts Set New Price Targets

Several research firms have recently issued reports on LUV. Jefferies Financial Group upgraded Southwest Airlines from an "underperform" rating to a "hold" rating and boosted their target price for the stock from $24.00 to $33.00 in a research report on Tuesday, May 27th. Susquehanna decreased their price objective on Southwest Airlines from $34.00 to $25.00 and set a "neutral" rating for the company in a research report on Monday, April 7th. Hsbc Global Res upgraded Southwest Airlines to a "moderate sell" rating in a research report on Thursday, July 24th. Wall Street Zen downgraded Southwest Airlines from a "hold" rating to a "sell" rating in a research report on Saturday, July 26th. Finally, Evercore ISI reduced their price target on Southwest Airlines from $40.00 to $34.00 and set an "in-line" rating for the company in a research report on Friday, July 25th. Seven equities research analysts have rated the stock with a sell rating, nine have assigned a hold rating and four have issued a buy rating to the company's stock. According to MarketBeat.com, Southwest Airlines has an average rating of "Hold" and a consensus price target 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.

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