Zacks Investment Research upgraded shares of Southwest Airlines (NYSE:LUV) from a sell rating to a hold rating in a research note released on Monday morning, Zacks.com reports. Zacks Investment Research currently has $59.00 target price on the airline’s stock.
According to Zacks, “We are appreciative of Southwest Airlines' efforts to reward its shareholders through dividends and buybacks. In 2018, the company rewarded $2.3 billion to its shareholders. Continuing its pro-investor approach, in May 2019, the carrier's board increased its quarterly dividend by 12.5% to 18 cents per share and cleared a new buyback program. Passenger revenue growth (up 2.9% in the first half of 2019), despite the MAX groundings, is an added positive. The airline’s unit revenue guidance for third-quarter 2019 is also upbeat. Due to these tailwinds, shares of Southwest have outperformed its industry so far this year. However, non-fuel unit costs are rising due to the MAX groundings and might limit bottom-line growth. Fuel-efficiency is also being hampered with the company's most fuel-efficient aircraft remaining grounded.”
Several other research firms have also recently weighed in on LUV. Macquarie upgraded shares of Southwest Airlines from a neutral rating to an outperform rating and set a $67.00 price objective for the company in a research report on Friday, September 13th. Argus cut shares of Southwest Airlines from a buy rating to a hold rating in a research report on Tuesday, August 13th. Cowen reiterated a market perform rating and set a $57.00 price objective (up from $55.00) on shares of Southwest Airlines in a research report on Friday, July 26th. Morgan Stanley decreased their price objective on shares of Southwest Airlines from $64.00 to $59.00 and set an overweight rating for the company in a research report on Wednesday, August 14th. Finally, Berenberg Bank started coverage on shares of Southwest Airlines in a research report on Friday, September 6th. They set a hold rating and a $57.00 price objective for the company. Two investment analysts have rated the stock with a sell rating, ten have assigned a hold rating and six have assigned a buy rating to the company. Southwest Airlines presently has an average rating of Hold and a consensus price target of $57.22.
Southwest Airlines (NYSE:LUV) last released its quarterly earnings results on Thursday, July 25th. The airline reported $1.37 earnings per share (EPS) for the quarter, beating the Thomson Reuters’ consensus estimate of $1.35 by $0.02. The firm had revenue of $5.91 billion during the quarter, compared to the consensus estimate of $5.94 billion. Southwest Airlines had a net margin of 10.73% and a return on equity of 24.12%. The company’s revenue for the quarter was up 2.9% on a year-over-year basis. During the same quarter last year, the firm earned $1.26 earnings per share. As a group, sell-side analysts forecast that Southwest Airlines will post 4.27 earnings per share for the current fiscal year.
The business also recently declared a quarterly dividend, which was paid on Wednesday, September 11th. Shareholders of record on Wednesday, August 21st were issued a $0.18 dividend. This represents a $0.72 dividend on an annualized basis and a yield of 1.31%. The ex-dividend date was Tuesday, August 20th. Southwest Airlines’s payout ratio is 16.98%.
Large investors have recently bought and sold shares of the business. Global Wealth Management Investment Advisory Inc. grew its holdings in Southwest Airlines by 242.8% in the second quarter. Global Wealth Management Investment Advisory Inc. now owns 713 shares of the airline’s stock worth $36,000 after purchasing an additional 505 shares during the period. Doyle Wealth Management acquired a new stake in Southwest Airlines in the second quarter worth $58,000. Westside Investment Management Inc. acquired a new stake in Southwest Airlines in the second quarter worth $60,000. Clear Perspective Advisors LLC acquired a new stake in Southwest Airlines in the second quarter worth $60,000. Finally, NEXT Financial Group Inc grew its holdings in Southwest Airlines by 1,073.5% in the second quarter. NEXT Financial Group Inc now owns 1,197 shares of the airline’s stock worth $61,000 after purchasing an additional 1,095 shares during the period. Institutional investors and hedge funds own 82.02% of the company’s stock.
About Southwest Airlines
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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