Southwest Airlines (NYSE:LUV) Stock Price Up 6.4% on Analyst Upgrade

Southwest Airlines Co. (NYSE:LUV)’s stock price was up 6.4% during mid-day trading on Tuesday after UBS Group upgraded the stock from a neutral rating to a buy rating. UBS Group now has a $73.00 price target on the stock, up from their previous price target of $51.00. Southwest Airlines traded as high as $54.32 and last traded at $54.4030. Approximately 4,956,862 shares were traded during mid-day trading, a decline of 52% from the average daily volume of 10,257,155 shares. The stock had previously closed at $51.11.

A number of other equities analysts have also recently weighed in on LUV. BNP Paribas Exane increased their target price on Southwest Airlines from $19.00 to $24.00 and gave the stock an “underperform” rating in a research note on Monday, December 8th. Wells Fargo & Company increased their price target on shares of Southwest Airlines from $45.00 to $50.00 and gave the stock an “equal weight” rating in a research report on Friday, January 30th. Susquehanna raised their price objective on shares of Southwest Airlines from $45.00 to $55.00 and gave the company a “neutral” rating in a research note on Tuesday, February 3rd. Bank of America upped their target price on shares of Southwest Airlines from $37.00 to $42.00 and gave the stock an “underperform” rating in a research note on Friday, January 30th. Finally, Deutsche Bank Aktiengesellschaft increased their price objective on Southwest Airlines from $40.00 to $48.00 and gave the company a “buy” rating in a research note on Friday, December 12th. One analyst has rated the stock with a Strong Buy rating, seven have issued a Buy rating, nine have assigned a Hold rating and three have given a Sell rating to the company. Based on data from MarketBeat, the company presently has a consensus rating of “Hold” and a consensus target price of $48.14.

Institutional Inflows and Outflows

Several large investors have recently modified their holdings of the stock. Arrowstreet Capital Limited Partnership lifted its position in Southwest Airlines by 2,403.8% in the second quarter. Arrowstreet Capital Limited Partnership now owns 10,120,368 shares of the airline’s stock valued at $328,305,000 after acquiring an additional 9,716,160 shares during the last quarter. Norges Bank acquired a new stake in shares of Southwest Airlines in the 4th quarter valued at about $172,038,000. Ameriprise Financial Inc. grew its stake in Southwest Airlines by 43.7% during the 3rd quarter. Ameriprise Financial Inc. now owns 12,335,167 shares of the airline’s stock worth $393,615,000 after buying an additional 3,753,183 shares during the last quarter. SG Americas Securities LLC grew its stake in Southwest Airlines by 2,468.4% during the 4th quarter. SG Americas Securities LLC now owns 3,752,352 shares of the airline’s stock worth $155,085,000 after buying an additional 3,606,255 shares during the last quarter. Finally, Massachusetts Financial Services Co. MA acquired a new position in Southwest Airlines during the fourth quarter worth approximately $143,450,000. Institutional investors and hedge funds own 80.82% of the company’s stock.

Southwest Airlines Stock Performance

The company has a market cap of $26.65 billion, a PE ratio of 64.65, a PEG ratio of 0.36 and a beta of 1.15. The stock has a 50 day simple moving average of $44.34 and a two-hundred day simple moving average of $36.56. The company has a debt-to-equity ratio of 0.57, a current ratio of 0.52 and a quick ratio of 0.45.

Southwest Airlines (NYSE:LUV) last announced its earnings results on Wednesday, January 28th. The airline reported $0.58 earnings per share for the quarter, topping the consensus estimate of $0.56 by $0.02. Southwest Airlines had a net margin of 1.57% and a return on equity of 6.18%. The business had revenue of $7.44 billion during the quarter, compared to the consensus estimate of $7.51 billion. During the same quarter in the prior year, the firm earned $0.56 earnings per share. The business’s quarterly revenue was up 7.4% compared to the same quarter last year. Southwest Airlines has set its FY 2026 guidance at 4.000- EPS and its Q1 2026 guidance at 0.450- EPS. Equities analysts predict that Southwest Airlines Co. will post 1.55 EPS for the current year.

Southwest Airlines Announces Dividend

The firm also recently announced a quarterly dividend, which will be paid on Thursday, April 2nd. Shareholders of record on Thursday, March 12th will be given a dividend of $0.18 per share. The ex-dividend date is Thursday, March 12th. This represents a $0.72 annualized dividend and a yield of 1.3%. Southwest Airlines’s payout ratio is presently 85.71%.

Southwest Airlines Company Profile

Southwest Airlines Co is a U.S.-based low-cost carrier that operates a point-to-point domestic and near-international airline network. Headquartered in Dallas, Texas, the company primarily flies Boeing 737 aircraft and offers no-frills, single-class service designed to keep fares competitive. Southwest’s operating model emphasizes high aircraft utilization, quick turnaround times and an open seating policy, allowing customers to board and select seats on a first-come, first-served basis.

Founded in 1967 by Herb Kelleher and Rollin King as Air Southwest Company, Southwest began commercial service in 1971, initially connecting Dallas, Houston and San Antonio.