Susquehanna Forecasts Strong Price Appreciation for Southwest Airlines (NYSE:LUV) Stock

Key Points

• Susquehanna raised its price target for Southwest Airlines from $30.00 to $35.00, indicating a potential upside of 5.73% from the current stock price, while maintaining a "neutral" rating.
• Southwest Airlines' quarterly earnings missed expectations, reporting $0.43 EPS compared to the consensus estimate of $0.51, with revenue down 2.1% year-over-year at $7.24 billion.
• The airline's Board of Directors has initiated a share repurchase program to buy back $2.00 billion in shares, reflecting confidence that its stock is undervalued.

Southwest Airlines (NYSE:LUV - Get Free Report) had its price objective hoisted by Susquehanna from $30.00 to $35.00 in a research report issued to clients and investors on Friday,Benzinga reports. The firm presently has a "neutral" rating on the airline's stock. Susquehanna's price target would suggest a potential upside of 5.73% from the stock's current price.

LUV has been the topic of a number of other reports. UBS Group raised their target price on shares of Southwest Airlines from $27.00 to $34.00 and gave the company a "neutral" rating in a research note on Monday, July 7th. Hsbc Global Res raised shares of Southwest Airlines to a "moderate sell" rating in a research note on Thursday, July 24th. Barclays raised their target price on shares of Southwest Airlines from $26.00 to $34.00 and gave the company an "equal weight" rating in a research note on Thursday, July 10th. Evercore ISI raised their target price on shares of Southwest Airlines from $34.00 to $35.00 and gave the company an "in-line" rating in a research note on Monday. Finally, Wall Street Zen downgraded shares of Southwest Airlines from a "hold" rating to a "sell" rating in a research note on Saturday, July 26th. Five equities research analysts have rated the stock with a Buy rating, nine have issued a Hold rating and four have issued a Sell rating to the company. Based on data from MarketBeat.com, the company presently has an average rating of "Hold" and an average target price of $33.63.

Southwest Airlines Stock Up 2.5%

LUV traded up $0.79 during trading on Friday, hitting $33.10. 2,027,559 shares of the company's stock were exchanged, compared to its average volume of 11,211,721. The business's 50 day moving average is $31.66 and its two-hundred day moving average is $31.54. The stock has a market cap of $17.39 billion, a P/E ratio of 50.04, a PEG ratio of 0.85 and a beta of 1.21. The company has a quick ratio of 0.49, a current ratio of 0.56 and a debt-to-equity ratio of 0.51. Southwest Airlines has a fifty-two week low of $23.82 and a fifty-two week high of $37.96.

Southwest Airlines (NYSE:LUV - Get Free Report) last announced its quarterly earnings data 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 business's revenue was down 2.1% on a year-over-year basis. During the same period in the prior year, the firm posted $0.58 EPS. As a group, equities analysts expect that Southwest Airlines will post 1.55 earnings per share for the current fiscal year.

Southwest Airlines announced that its Board of Directors has initiated 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 an indication that the company's leadership believes its shares are undervalued.

Insider Buying and Selling at Southwest Airlines

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

Hedge Funds Weigh In On Southwest Airlines

Large investors have recently modified their holdings of the business. Ameriflex Group Inc. boosted its holdings in shares of Southwest Airlines by 7.1% during the 2nd quarter. Ameriflex Group Inc. now owns 4,690 shares of the airline's stock valued at $148,000 after acquiring an additional 310 shares in the last quarter. Benjamin Edwards Inc. boosted its holdings in shares of Southwest Airlines by 1.4% during the 2nd quarter. Benjamin Edwards Inc. now owns 24,857 shares of the airline's stock valued at $806,000 after acquiring an additional 333 shares in the last quarter. Copperwynd Financial LLC boosted its holdings in shares of Southwest Airlines by 2.1% during the 1st quarter. Copperwynd Financial LLC now owns 16,301 shares of the airline's stock valued at $547,000 after acquiring an additional 337 shares in the last quarter. GAMMA Investing LLC boosted its holdings in shares of Southwest Airlines by 2.4% during the 3rd quarter. GAMMA Investing LLC now owns 14,285 shares of the airline's stock valued at $456,000 after acquiring an additional 341 shares in the last quarter. Finally, PNC Financial Services Group Inc. boosted its holdings in shares of Southwest Airlines by 0.5% during the 1st quarter. PNC Financial Services Group Inc. now owns 76,719 shares of the airline's stock valued at $2,576,000 after acquiring an additional 345 shares in the last quarter. Institutional investors and hedge funds own 80.82% of the company's stock.

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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