Southwest Airlines (NYSE:LUV) Cut to “Hold” at Wall Street Zen

Wall Street Zen downgraded shares of Southwest Airlines (NYSE:LUV) from a buy rating to a hold rating in a report published on Saturday,Wall Street Zen reports.

LUV has been the topic of several other reports. Susquehanna raised their price objective on Southwest Airlines from $44.00 to $55.00 and gave the company a “neutral” rating in a research note on Tuesday, July 7th. Barclays increased their target price on shares of Southwest Airlines from $56.00 to $65.00 and gave the stock an “overweight” rating in a report on Thursday, June 25th. BMO Capital Markets lifted their price target on shares of Southwest Airlines from $58.50 to $60.00 and gave the company an “outperform” rating in a report on Friday, July 24th. Weiss Ratings raised shares of Southwest Airlines from a “hold (c)” rating to a “hold (c+)” rating in a research note on Tuesday, August 18th. Finally, Wells Fargo & Company raised their target price on shares of Southwest Airlines from $44.00 to $50.00 and gave the company an “equal weight” rating in a research report on Tuesday, June 30th. Nine investment analysts have rated the stock with a Buy rating, nine have assigned a Hold rating and four have assigned a Sell rating to the company’s stock. According to MarketBeat.com, the company presently has an average rating of “Hold” and a consensus target price of $49.01.

Southwest Airlines Price Performance

Shares of Southwest Airlines stock opened at $39.64 on Friday. The stock has a market capitalization of $19.39 billion, a price-to-earnings ratio of 24.32, a P/E/G ratio of 0.37 and a beta of 1.13. The firm’s 50-day moving average price is $45.15 and its two-hundred day moving average price is $43.49. The company has a current ratio of 0.49, a quick ratio of 0.42 and a debt-to-equity ratio of 0.54. Southwest Airlines has a 1-year low of $29.26 and a 1-year high of $55.11.

Southwest Airlines (NYSE:LUV) last posted its earnings results on Wednesday, July 22nd. The airline reported $0.94 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $0.52 by $0.42. Southwest Airlines had a net margin of 2.78% and a return on equity of 14.15%. The company had revenue of $8.72 billion during the quarter, compared to analysts’ expectations of $8.58 billion. During the same quarter in the previous year, the company posted $0.43 earnings per share. Southwest Airlines’s quarterly revenue was up 16.4% compared to the same quarter last year. Southwest Airlines has set its FY 2026 guidance at 3.250-4.250 EPS and its Q3 2026 guidance at 0.500-0.750 EPS. On average, equities analysts predict that Southwest Airlines will post 3.28 earnings per share for the current fiscal year.

Southwest Airlines Announces Dividend

The company also recently disclosed a quarterly dividend, which will be paid on Thursday, September 24th. Investors of record on Thursday, September 3rd will be paid a $0.18 dividend. The ex-dividend date is Thursday, September 3rd. This represents a $0.72 annualized dividend and a yield of 1.8%. Southwest Airlines’s dividend payout ratio is presently 44.17%.

Institutional Trading of Southwest Airlines

A number of large investors have recently bought and sold shares of the company. Primecap Management Co. CA purchased a new stake in shares of Southwest Airlines in the 2nd quarter valued at about $2,509,179,000. BlackRock Inc. acquired a new stake in shares of Southwest Airlines in the second quarter valued at approximately $1,538,382,000. Bank of New York Mellon Corp acquired a new stake in shares of Southwest Airlines in the second quarter valued at approximately $234,872,000. Norges Bank purchased a new stake in Southwest Airlines in the 4th quarter valued at $172,038,000. Finally, Franklin Resources Inc. raised its position in Southwest Airlines by 7.0% in the 4th quarter. Franklin Resources Inc. now owns 40,200,530 shares of the airline’s stock valued at $1,661,488,000 after purchasing an additional 2,626,853 shares during the last quarter. 80.82% of the stock is owned by hedge funds and other institutional investors.

About Southwest Airlines

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.