Recent Analysts’ Ratings Updates for Southwest Airlines (LUV)

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A number of firms have modified their ratings and price targets on shares of Southwest Airlines (NYSE: LUV) recently:

  • 5/16/2019 – Southwest Airlines was downgraded by analysts at Zacks Investment Research from a “hold” rating to a “sell” rating. According to Zacks, “Shares of Southwest Airlines have shed more than 9% of their value in the past three months due to headwinds like delayed launch of the Hawaii service, grounding of Boeing 737 MAX jets and the 35-day partial government shutdown. Southwest Airlines, which has 34 Boeing 737 MAX jets in its fleet, extended the grounding period of such jets from May end, announced previously, through Aug 5. Flight cancellations due to the grounding are not only increasing passengers' harassments but also pushing up costs. The carrier expects second-quarter non-fuel unit costs to increase in the 10.5-12.5% range year over year. The projection compares unfavorably to the 7.4% increase registered in the first quarter. Woes related to capacity overexpansion are also hurting Southwest Airlines. However, we are pleased with the company's efforts to reward its shareholders. The carrier's employee-friendly approach is encouraging as well.”
  • 5/1/2019 – Southwest Airlines had its “buy” rating reaffirmed by analysts at Argus.
  • 4/26/2019 – Southwest Airlines had its “in-line” rating reaffirmed by analysts at Imperial Capital. They now have a $55.00 price target on the stock, up previously from $52.00.
  • 4/26/2019 – Southwest Airlines had its price target lowered by analysts at Barclays PLC from $65.00 to $60.00. They now have an “equal weight” rating on the stock.
  • 4/16/2019 – Southwest Airlines was upgraded by analysts at ValuEngine from a “sell” rating to a “hold” rating.
  • 4/8/2019 – Southwest Airlines was downgraded by analysts at Raymond James from an “outperform” rating to a “market perform” rating. They now have a $53.25 price target on the stock.
  • 4/2/2019 – Southwest Airlines was downgraded by analysts at Zacks Investment Research from a “hold” rating to a “sell” rating. According to Zacks, “Southwest Airlines recently issued a drab guidance for first-quarter 2019 revenues as well as costs. Multiple headwinds like the grounding of Boeing 737 MAX jets and the 35-day partial government shutdown contributed to the bearish projections. These headwinds are likely to hurt revenues to the tune of $150 million. Non-fuel unit costs are projected to increase 10% in the first quarter of 2019. Also, the company’s recent agreement in principle with the union representing its mechanics is estimated to add approximately $30 million to costs associated with salaries, wages and benefits in the first quarter. The Zacks Consensus Estimate for first-quarter earnings has moved 19.1% south over the past 60 days, highlighting the negativity surrounding the stock. Detailed results should be out on Apr 25. However, we are appreciative of the company's efforts to enhance its shareholders' wealth through dividends and share buybacks.”
  • 3/28/2019 – Southwest Airlines had its price target lowered by analysts at Credit Suisse Group AG from $56.00 to $50.00. They now have a “neutral” rating on the stock.
  • 3/28/2019 – Southwest Airlines had its “in-line” rating reaffirmed by analysts at Imperial Capital. They now have a $52.00 price target on the stock, down previously from $55.00.
  • 3/28/2019 – Southwest Airlines was given a new $52.00 price target on by analysts at Macquarie. They now have a “hold” rating on the stock.
  • 3/27/2019 – Southwest Airlines had its price target lowered by analysts at Cowen Inc from $58.00 to $55.00. They now have a “market perform” rating on the stock.
  • 3/20/2019 – Southwest Airlines had its price target raised by analysts at Goldman Sachs Group Inc to $49.00. They now have a “sell” rating on the stock.
  • 3/20/2019 – Southwest Airlines had its price target lowered by analysts at Imperial Capital from $58.00 to $55.00. They now have an “in-line” rating on the stock.

Shares of LUV traded down $0.35 during mid-day trading on Friday, reaching $52.24. The company had a trading volume of 2,173,177 shares, compared to its average volume of 4,842,996. The company has a market capitalization of $28.24 billion, a price-to-earnings ratio of 12.32, a PEG ratio of 1.31 and a beta of 1.49. The company has a quick ratio of 0.57, a current ratio of 0.63 and a debt-to-equity ratio of 0.28. Southwest Airlines Co has a 52-week low of $44.28 and a 52-week high of $64.02.

Southwest Airlines (NYSE:LUV) last issued its quarterly earnings results on Thursday, April 25th. The airline reported $0.70 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $0.61 by $0.09. The company had revenue of $5.15 billion for the quarter, compared to the consensus estimate of $5.14 billion. Southwest Airlines had a return on equity of 23.94% and a net margin of 10.78%. Southwest Airlines’s revenue for the quarter was up 4.1% on a year-over-year basis. During the same quarter in the prior year, the business posted $0.79 earnings per share. As a group, equities analysts anticipate that Southwest Airlines Co will post 4.67 EPS for the current fiscal year.

The firm also recently declared a quarterly dividend, which will be paid on Wednesday, June 26th. Shareholders of record on Wednesday, June 5th will be given a dividend of $0.18 per share. The ex-dividend date of this dividend is Tuesday, June 4th. This represents a $0.72 dividend on an annualized basis and a yield of 1.38%. This is an increase from Southwest Airlines’s previous quarterly dividend of $0.16. Southwest Airlines’s dividend payout ratio is currently 15.09%.

A number of hedge funds have recently modified their holdings of the business. Ballentine Partners LLC boosted its position in Southwest Airlines by 4.3% during the first quarter. Ballentine Partners LLC now owns 4,802 shares of the airline’s stock worth $250,000 after purchasing an additional 199 shares in the last quarter. Haverford Financial Services Inc. raised its holdings in shares of Southwest Airlines by 1.2% during the first quarter. Haverford Financial Services Inc. now owns 16,400 shares of the airline’s stock valued at $851,000 after acquiring an additional 200 shares during the last quarter. Raymond James Trust N.A. raised its holdings in shares of Southwest Airlines by 2.1% during the first quarter. Raymond James Trust N.A. now owns 10,238 shares of the airline’s stock valued at $532,000 after acquiring an additional 209 shares during the last quarter. Piedmont Investment Advisors Inc. raised its holdings in shares of Southwest Airlines by 0.6% during the first quarter. Piedmont Investment Advisors Inc. now owns 34,286 shares of the airline’s stock valued at $1,780,000 after acquiring an additional 217 shares during the last quarter. Finally, Cerity Partners LLC raised its holdings in shares of Southwest Airlines by 4.6% during the fourth quarter. Cerity Partners LLC now owns 5,179 shares of the airline’s stock valued at $241,000 after acquiring an additional 228 shares during the last quarter. Institutional investors own 81.66% of the company’s stock.

Southwest Airlines Co operates a passenger airline that provides scheduled air transportation services in the United States and near-international markets. As of December 31, 2018, the company operated a total of 750 Boeing 737 aircraft; and served 99 destinations in 40 states, the District of Columbia, and the Commonwealth of Puerto Rico, as well as 10 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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