Southwest Airlines (NYSE:LUV) Lowered to Strong Sell Rating by Zacks Research

Zacks Research cut shares of Southwest Airlines (NYSE:LUV) from a hold rating to a strong sell rating in a research note released on Wednesday morning,Zacks.com reports.

Other equities research analysts have also issued reports about the company. Citigroup decreased their price target on Southwest Airlines from $54.00 to $44.00 and set a “neutral” rating on the stock in a research report on Friday, March 20th. JPMorgan Chase & Co. decreased their price target on Southwest Airlines from $58.00 to $56.00 in a research report on Friday, March 27th. Wells Fargo & Company decreased their price target on Southwest Airlines from $50.00 to $44.00 and set an “equal weight” rating on the stock in a research report on Monday, March 16th. BNP Paribas Exane upped their price objective on Southwest Airlines from $24.00 to $33.00 and gave the stock an “underperform” rating in a report on Tuesday, April 21st. Finally, Raymond James Financial upped their price objective on Southwest Airlines from $45.00 to $55.00 and gave the stock an “outperform” rating in a report on Friday, April 24th. Nine analysts have rated the stock with a Buy rating, eight have given a Hold rating and five have given a Sell rating to the company’s stock. According to MarketBeat.com, the company has an average rating of “Hold” and a consensus price target of $43.96.

Southwest Airlines Trading Down 1.0%

LUV stock opened at $43.25 on Wednesday. Southwest Airlines has a 1-year low of $28.98 and a 1-year high of $55.11. The firm has a market cap of $21.14 billion, a P/E ratio of 27.91, a P/E/G ratio of 0.48 and a beta of 1.12. The business’s 50 day moving average is $39.70 and its 200-day moving average is $41.52. The company has a current ratio of 0.48, a quick ratio of 0.41 and a debt-to-equity ratio of 0.66.

Southwest Airlines (NYSE:LUV) last released its quarterly earnings data on Wednesday, April 22nd. The airline reported $0.45 earnings per share for the quarter, meeting the consensus estimate of $0.45. Southwest Airlines had a return on equity of 10.66% and a net margin of 2.83%.The company had revenue of $7.25 billion for the quarter, compared to analyst estimates of $8.46 billion. During the same period in the prior year, the company posted ($0.13) EPS. The company’s revenue was up 12.8% compared to the same quarter last year. Southwest Airlines has set its Q2 2026 guidance at 0.350-0.650 EPS. Equities analysts anticipate that Southwest Airlines will post 2.76 earnings per share for the current fiscal year.

Southwest Airlines Announces Dividend

The firm also recently announced a quarterly dividend, which will be paid on Thursday, July 2nd. Stockholders of record on Thursday, June 11th will be paid a $0.18 dividend. This represents a $0.72 annualized dividend and a dividend yield of 1.7%. The ex-dividend date of this dividend is Thursday, June 11th. Southwest Airlines’s dividend payout ratio (DPR) is 46.45%.

Institutional Inflows and Outflows

Several hedge funds have recently modified their holdings of the business. Franklin Resources Inc. boosted its stake in shares of 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. Ameriprise Financial Inc. boosted its stake in shares of Southwest Airlines by 43.7% in the 3rd quarter. Ameriprise Financial Inc. now owns 12,335,167 shares of the airline’s stock valued at $393,615,000 after purchasing an additional 3,753,183 shares during the last quarter. JPMorgan Chase & Co. lifted its stake in shares of Southwest Airlines by 13.6% in the 3rd quarter. JPMorgan Chase & Co. now owns 12,218,086 shares of the airline’s stock valued at $389,879,000 after purchasing an additional 1,459,235 shares during the period. Invesco Ltd. boosted its position in shares of Southwest Airlines by 9.2% in the 3rd quarter. Invesco Ltd. now owns 6,837,197 shares of the airline’s stock worth $218,175,000 after purchasing an additional 577,326 shares during the last quarter. Finally, Morgan Stanley boosted its position in shares of Southwest Airlines by 4.1% in the 4th quarter. Morgan Stanley now owns 6,228,475 shares of the airline’s stock worth $257,423,000 after purchasing an additional 244,891 shares during the last quarter. Institutional investors own 80.82% of the company’s stock.

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.