Southwest Airlines (NYSE:LUV) was upgraded by Zacks Investment Research from a “hold” rating to a “buy” rating in a research report issued to clients and investors on Friday. The brokerage currently has a $55.00 price target on the airline’s stock. Zacks Investment Research‘s target price would suggest a potential upside of 14.46% from the stock’s current price.

According to Zacks, “Fuel costs have been on a downward trend lately. In fact, oil prices registered their steepest monthly drop, in a decade, in November. This bodes well for airline stocks including Southwest. Taking advantage of the low oil price scenario, Southwest trimmed its forecast for the fourth quarter of 2018. Detailed results will be out on Jan 24. The Zacks Consensus Estimate for fourth-quarter earnings increased 1.9% over the last 60 days. This highlights the positivity surrounding the stock. Moreover, the carrier's efforts to reward shareholders are impressive. Furthermore, efforts to modernize its fleet are praiseworthy. Southwest is constantly adding more efficient planes to its fleet and removing outdated ones. However, capacity-related woes also do not bode well for Southwest. In fact, load factor has declined for eight consecutive months due to capacity overexpansion. Fourth-quarter capacity is likely to expand between 6% and 6.5%.”

A number of other equities analysts have also recently commented on the stock. Goldman Sachs Group initiated coverage on shares of Southwest Airlines in a report on Monday, November 12th. They issued a “neutral” rating and a $61.00 target price on the stock. Imperial Capital cut their target price on shares of Southwest Airlines from $66.00 to $56.00 and set an “in-line” rating on the stock in a report on Friday, October 26th. Wolfe Research raised shares of Southwest Airlines from a “market perform” rating to an “outperform” rating in a report on Friday, December 7th. ValuEngine raised shares of Southwest Airlines from a “hold” rating to a “buy” rating in a report on Monday, September 17th. Finally, Morgan Stanley cut their target price on shares of Southwest Airlines from $68.00 to $64.00 and set an “overweight” rating on the stock in a report on Wednesday, November 14th. One equities research analyst has rated the stock with a sell rating, seven have issued a hold rating and fourteen have issued a buy rating to the company’s stock. Southwest Airlines currently has a consensus rating of “Buy” and a consensus price target of $61.56.

Shares of Southwest Airlines stock opened at $48.05 on Friday. The company has a quick ratio of 0.65, a current ratio of 0.71 and a debt-to-equity ratio of 0.47. Southwest Airlines has a 52-week low of $44.28 and a 52-week high of $66.52. The company has a market capitalization of $27.60 billion, a P/E ratio of 13.73, a PEG ratio of 0.92 and a beta of 1.31.

Southwest Airlines (NYSE:LUV) last released its quarterly earnings data on Thursday, October 25th. The airline reported $1.08 earnings per share for the quarter, topping analysts’ consensus estimates of $1.06 by $0.02. Southwest Airlines had a net margin of 17.18% and a return on equity of 22.27%. The company had revenue of $5.58 billion for the quarter, compared to analysts’ expectations of $5.56 billion. During the same quarter last year, the company earned $0.88 earnings per share. On average, equities research analysts anticipate that Southwest Airlines will post 4.13 EPS for the current fiscal year.

In related news, Director John T. Montford sold 956 shares of the business’s stock in a transaction dated Monday, November 19th. The shares were sold at an average price of $52.35, for a total value of $50,046.60. The transaction was disclosed in a document filed with the SEC, which is available through this link. Also, Director John T. Montford sold 980 shares of the business’s stock in a transaction dated Wednesday, December 12th. The stock was sold at an average price of $51.27, for a total transaction of $50,244.60. Following the completion of the sale, the director now owns 20,983 shares in the company, valued at $1,075,798.41. The disclosure for this sale can be found here. 0.23% of the stock is currently owned by insiders.

Several institutional investors have recently added to or reduced their stakes in LUV. TRUE Private Wealth Advisors acquired a new position in Southwest Airlines in the 3rd quarter valued at about $111,000. Northwest Wealth Management LLC increased its stake in shares of Southwest Airlines by 357.1% during the 3rd quarter. Northwest Wealth Management LLC now owns 1,920 shares of the airline’s stock valued at $120,000 after acquiring an additional 1,500 shares during the last quarter. Flagship Harbor Advisors LLC acquired a new position in shares of Southwest Airlines during the 2nd quarter valued at about $101,000. Girard Partners LTD. acquired a new position in shares of Southwest Airlines during the 3rd quarter valued at about $126,000. Finally, Psagot Investment House Ltd. acquired a new position in shares of Southwest Airlines during the 3rd quarter valued at about $131,000. Institutional investors and hedge funds own 79.43% of the company’s stock.

Southwest Airlines Company Profile

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, 2017, the company operated a total of 706 Boeing 737 aircraft; and served 100 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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