Q4 EPS Forecast for Southwest Airlines Raised by Analyst

Key Points

• Zacks Research has upgraded its Q4 2025 earnings per share (EPS) estimate for Southwest Airlines to $0.58, reflecting an increase from the previous estimate of $0.54.
• The airline's recent quarterly results showed an EPS of $0.43, which was below analysts' expectations of $0.51, alongside a revenue of $7.24 billion, slightly missing the consensus estimate.
• Southwest Airlines announced a stock buyback program authorizing the repurchase of up to $2 billion in shares, indicating management’s belief that the stock is undervalued.

Southwest Airlines Co. (NYSE:LUV - Free Report) - Zacks Research raised their Q4 2025 EPS estimates for Southwest Airlines in a report released on Wednesday, August 6th. Zacks Research analyst S. Goswami now forecasts that the airline will post earnings of $0.58 per share for the quarter, up from their previous forecast of $0.54. The consensus estimate for Southwest Airlines' current full-year earnings is $1.55 per share. Zacks Research also issued estimates for Southwest Airlines' Q1 2026 earnings at $0.32 EPS, Q4 2026 earnings at $1.02 EPS, Q1 2027 earnings at $0.25 EPS and Q2 2027 earnings at $0.98 EPS.

Southwest Airlines (NYSE:LUV - Get Free Report) last issued 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 analysts' expectations 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 for the quarter was down 2.1% compared to the same quarter last year. During the same period last year, the company earned $0.58 earnings per share.

Several other analysts also recently commented on the stock. UBS Group increased their target price on shares of Southwest Airlines from $27.00 to $34.00 and gave the company a "neutral" rating in a report on Monday, July 7th. HSBC lowered shares of Southwest Airlines from a "hold" rating to a "reduce" rating in a research note on Thursday, July 24th. Barclays upped their target price on Southwest Airlines from $26.00 to $34.00 and gave the company an "equal weight" rating in a report on Thursday, July 10th. Hsbc Global Res upgraded Southwest Airlines to a "moderate sell" rating in a report on Thursday, July 24th. Finally, Jefferies Financial Group upgraded Southwest Airlines from an "underperform" rating to a "hold" rating and lifted their price target for the stock from $24.00 to $33.00 in a report on Tuesday, May 27th. Seven 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. Based on data from MarketBeat, the stock currently has a consensus rating of "Hold" and an average price target of $33.06.

Southwest Airlines Stock Up 0.2%

NYSE LUV traded up $0.07 on Friday, reaching $29.63. The company had a trading volume of 7,081,895 shares, compared to its average volume of 12,768,234. 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 has a market capitalization of $15.56 billion, a P/E ratio of 44.89, a P/E/G ratio of 0.74 and a beta of 1.26. The company's fifty day moving average is $33.15 and its 200 day moving average is $31.18. Southwest Airlines has a 52-week low of $23.82 and a 52-week high of $37.96.

Institutional Investors Weigh In On Southwest Airlines

Institutional investors and hedge funds have recently made changes to their positions in the business. Caitong International Asset Management Co. Ltd bought a new position in Southwest Airlines in the 2nd quarter worth about $31,000. Pandora Wealth Inc. purchased a new position in shares of Southwest Airlines during the first quarter worth about $34,000. Hantz Financial Services Inc. increased its position in shares of Southwest Airlines by 81.4% in the second quarter. Hantz Financial Services Inc. now owns 1,056 shares of the airline's stock worth $34,000 after purchasing an additional 474 shares during the last quarter. Cheviot Value Management LLC purchased a new stake in Southwest Airlines in the first quarter valued at approximately $42,000. Finally, Armstrong Advisory Group Inc. purchased a new stake in Southwest Airlines in the second quarter valued at approximately $42,000. Hedge funds and other institutional investors own 80.82% of the company's stock.

Insider Buying and Selling at Southwest Airlines

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

Southwest Airlines Dividend Announcement

The business also recently declared a quarterly dividend, which will be paid on Wednesday, September 24th. Stockholders 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 annualized dividend and a dividend yield of 2.4%. Southwest Airlines's payout ratio is 109.09%.

Southwest Airlines declared that its board has approved a share buyback program on Wednesday, July 23rd that authorizes the company to repurchase $2.00 billion in shares. This repurchase authorization authorizes the airline to buy up to 9.4% of its shares through open market purchases. Shares repurchase programs are generally an indication that the company's board of directors 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.