Southwest Airlines (LUV) Competitors

American Airlines Group (NASDAQ:AAL) and Southwest Airlines (NYSE:LUV) are both transportation companies, but which is the better stock? We will compare the two companies based on the strength of their earnings, risk, analyst recommendations, profitability, institutional ownership, dividends, media sentiment and valuation.

Is AAL or LUV a better dividend stock?

American Airlines Group pays an annual dividend of $0.40 per share and has a dividend yield of 3.4%. Southwest Airlines pays an annual dividend of $0.72 per share and has a dividend yield of 2.3%. American Airlines Group pays out 50.0% of its earnings in the form of a dividend. Southwest Airlines pays out 109.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. American Airlines Group is clearly the better dividend stock, given its higher yield and lower payout ratio.

Is AAL or LUV more profitable?

Southwest Airlines has a net margin of 1.43% compared to American Airlines Group's net margin of 1.05%. Southwest Airlines' return on equity of 6.27% beat American Airlines Group's return on equity.

Company	Net Margins	Return on Equity	Return on Assets
American Airlines Group	1.05%	-24.55%	1.68%
Southwest Airlines	1.43%	6.27%	1.83%

Which has better valuation & earnings, AAL or LUV?

American Airlines Group has higher revenue and earnings than Southwest Airlines. American Airlines Group is trading at a lower price-to-earnings ratio than Southwest Airlines, indicating that it is currently the more affordable of the two stocks.

Company	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
American Airlines Group	$54.25B	0.14	$846M	$0.80	14.67
Southwest Airlines	$27.47B	0.61	$465M	$0.66	48.20

Does the media prefer AAL or LUV?

In the previous week, American Airlines Group had 4 more articles in the media than Southwest Airlines. MarketBeat recorded 19 mentions for American Airlines Group and 15 mentions for Southwest Airlines. American Airlines Group's average media sentiment score of 0.92 beat Southwest Airlines' score of 0.64 indicating that American Airlines Group is being referred to more favorably in the media.

Company	Very Positive	Positive	Neutral	Negative	Very Negative	Overall Sentiment
American Airlines Group	11 Very Positive mention(s)	2 Positive mention(s)	4 Neutral mention(s)	0 Negative mention(s)	0 Very Negative mention(s)	Positive
Southwest Airlines	4 Very Positive mention(s)	3 Positive mention(s)	6 Neutral mention(s)	0 Negative mention(s)	0 Very Negative mention(s)	Positive

Do institutionals and insiders hold more shares of AAL or LUV?

52.4% of American Airlines Group shares are held by institutional investors. Comparatively, 80.8% of Southwest Airlines shares are held by institutional investors. 0.6% of American Airlines Group shares are held by company insiders. Comparatively, 0.8% of Southwest Airlines shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Which has more volatility and risk, AAL or LUV?

American Airlines Group has a beta of 1.36, suggesting that its stock price is 36% more volatile than the S&P 500. Comparatively, Southwest Airlines has a beta of 1.21, suggesting that its stock price is 21% more volatile than the S&P 500.

Do analysts prefer AAL or LUV?

American Airlines Group presently has a consensus price target of $16.59, suggesting a potential upside of 41.37%. Southwest Airlines has a consensus price target of $33.38, suggesting a potential upside of 4.92%. Given American Airlines Group's stronger consensus rating and higher probable upside, equities research analysts plainly believe American Airlines Group is more favorable than Southwest Airlines.

Company	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
American Airlines Group	1 Sell rating(s)	8 Hold rating(s)	8 Buy rating(s)	2 Strong Buy rating(s)	2.58
Southwest Airlines	4 Sell rating(s)	10 Hold rating(s)	5 Buy rating(s)	0 Strong Buy rating(s)	2.05

Summary

American Airlines Group beats Southwest Airlines on 12 of the 19 factors compared between the two stocks.