Southwest Airlines (NYSE:LUV) Price Target Cut to $41.00 by Analysts at Jefferies Financial Group

Key Points

• Jefferies lowered its price target on Southwest to $41 from $48 and kept a "hold" rating, implying only about a 4.7% upside from the stock's recent price.
• Analyst views are mixed: the consensus rating is "Hold" with an average target of $47.34 (1 Strong Buy, 8 Buy, 8 Hold, 4 Sell), while several firms including Morgan Stanley, Citigroup and JPMorgan have recently raised targets—JPMorgan upgraded to "overweight" with a $60 target.
• Shares traded down to $39.17 after the report; Southwest beat Q4 EPS estimates ($0.58 vs. $0.56) but missed revenue, set FY2026 guidance near $4.00 EPS and Q1 guidance around $0.45, and currently shows a market cap of about $19.2 billion and a P/E of ~46.7.

Southwest Airlines (NYSE:LUV - Get Free Report) had its target price lowered by equities research analysts at Jefferies Financial Group from $48.00 to $41.00 in a research report issued on Thursday,Benzinga reports. The brokerage presently has a "hold" rating on the airline's stock. Jefferies Financial Group's price target would suggest a potential upside of 4.68% from the stock's current price.

A number of other equities analysts have also commented on LUV. Morgan Stanley lifted their price objective on Southwest Airlines from $50.00 to $55.00 and gave the stock an "overweight" rating in a research note on Friday, January 30th. Deutsche Bank Aktiengesellschaft increased their price objective on shares of Southwest Airlines from $40.00 to $48.00 and gave the stock a "buy" rating in a research report on Friday, December 12th. Evercore lifted their target price on shares of Southwest Airlines from $40.00 to $45.00 and gave the stock an "in-line" rating in a research note on Thursday, January 29th. Citigroup upped their price target on shares of Southwest Airlines from $44.00 to $54.00 in a research report on Tuesday, February 3rd. Finally, JPMorgan Chase & Co. upgraded Southwest Airlines from an "underweight" rating to an "overweight" rating and increased their price target for the stock from $36.00 to $60.00 in a report on Friday, January 9th. One analyst has rated the stock with a Strong Buy rating, eight have issued a Buy rating, eight have assigned a Hold rating and four have assigned a Sell rating to the company's stock. According to data from MarketBeat.com, the stock has an average rating of "Hold" and a consensus target price of $47.34.

Southwest Airlines Price Performance

LUV traded down $2.68 on Thursday, reaching $39.17. The stock had a trading volume of 4,911,559 shares, compared to its average volume of 10,499,566. The firm has a 50-day moving average of $46.78 and a 200-day moving average of $38.62. Southwest Airlines has a fifty-two week low of $23.82 and a fifty-two week high of $55.11. The company has a current ratio of 0.52, a quick ratio of 0.45 and a debt-to-equity ratio of 0.57. The company has a market capitalization of $19.24 billion, a price-to-earnings ratio of 46.70, a price-to-earnings-growth ratio of 0.30 and a beta of 1.10.

Southwest Airlines (NYSE:LUV - Get Free Report) last posted its earnings results on Wednesday, January 28th. The airline reported $0.58 earnings per share for the quarter, topping analysts' consensus estimates of $0.56 by $0.02. The firm had revenue of $7.44 billion for the quarter, compared to analyst estimates of $7.51 billion. Southwest Airlines had a net margin of 1.57% and a return on equity of 6.18%. The company's revenue for the quarter was up 7.4% compared to the same quarter last year. During the same period in the previous year, the firm posted $0.56 EPS. Southwest Airlines has set its FY 2026 guidance at 4.000- EPS and its Q1 2026 guidance at 0.450- EPS. As a group, sell-side analysts anticipate that Southwest Airlines will post 1.55 EPS for the current year.

Hedge Funds Weigh In On Southwest Airlines

Large investors have recently bought and sold shares of the stock. Franklin Resources Inc. boosted its holdings in Southwest Airlines by 7.0% in the 4th quarter. Franklin Resources Inc. now owns 40,200,530 shares of the airline's stock valued at $1,661,488,000 after purchasing an additional 2,626,853 shares during the period. Ameriprise Financial Inc. increased its holdings in shares of Southwest Airlines by 43.7% in the third quarter. Ameriprise Financial Inc. now owns 12,335,167 shares of the airline's stock worth $393,615,000 after purchasing an additional 3,753,183 shares during the period. JPMorgan Chase & Co. raised its position in shares of Southwest Airlines by 13.6% in the third quarter. JPMorgan Chase & Co. now owns 12,218,086 shares of the airline's stock worth $389,879,000 after buying an additional 1,459,235 shares in the last quarter. Artisan Partners Limited Partnership raised its position in shares of Southwest Airlines by 0.9% in the second quarter. Artisan Partners Limited Partnership now owns 10,763,935 shares of the airline's stock worth $349,182,000 after buying an additional 98,290 shares in the last quarter. Finally, Arrowstreet Capital Limited Partnership boosted its stake in Southwest Airlines by 2,403.8% during the second quarter. Arrowstreet Capital Limited Partnership now owns 10,120,368 shares of the airline's stock valued at $328,305,000 after buying an additional 9,716,160 shares during the period. 80.82% of the stock is currently owned by institutional investors.

Southwest Airlines Company Profile

Southwest Airlines Co is a U.S.-based low-cost carrier that operates a point-to-point domestic and near-international airline network. Headquartered in Dallas, Texas, the company primarily flies Boeing 737 aircraft and offers no-frills, single-class service designed to keep fares competitive. Southwest's operating model emphasizes high aircraft utilization, quick turnaround times and an open seating policy, allowing customers to board and select seats on a first-come, first-served basis.

Founded in 1967 by Herb Kelleher and Rollin King as Air Southwest Company, Southwest began commercial service in 1971, initially connecting Dallas, Houston and San Antonio.

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