Zacks Investment Research upgraded shares of Southwest Airlines (NYSE:LUV) from a sell rating to a hold rating in a research note issued to investors on Monday, Zacks.com reports. The brokerage currently has $59.00 price target 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.”
A number of other equities research analysts have also recently issued reports on LUV. Wolfe Research raised shares of Southwest Airlines from a peer perform rating to an outperform rating and set a $57.00 target price on the stock in a report on Friday, August 16th. Argus lowered shares of Southwest Airlines from a buy rating to a hold rating in a research note on Tuesday, August 13th. Berenberg Bank began coverage on shares of Southwest Airlines in a research note on Friday, September 6th. They issued a hold rating and a $57.00 price target on the stock. Cowen reiterated a market perform rating and issued a $57.00 price target (up previously from $55.00) on shares of Southwest Airlines in a research note on Friday, July 26th. Finally, Macquarie upgraded shares of Southwest Airlines from a neutral rating to an outperform rating and set a $67.00 price target on the stock in a research note on Friday, September 13th. Two equities research analysts have rated the stock with a sell rating, ten have issued a hold rating and six have assigned a buy rating to the stock. Southwest Airlines has a consensus rating of Hold and a consensus target price of $57.22.
Shares of LUV stock opened at $55.08 on Monday. The company has a debt-to-equity ratio of 0.37, a quick ratio of 0.59 and a current ratio of 0.64. The firm’s 50-day moving average is $51.68 and its 200-day moving average is $51.81. The stock has a market cap of $29.64 billion, a price-to-earnings ratio of 12.99, a PEG ratio of 1.35 and a beta of 1.45. Southwest Airlines has a 52-week low of $44.28 and a 52-week high of $64.02.
Southwest Airlines (NYSE:LUV) last issued its earnings results on Thursday, July 25th. The airline reported $1.37 earnings per share (EPS) for the quarter, beating the Zacks’ consensus estimate of $1.35 by $0.02. The company had revenue of $5.91 billion for the quarter, compared to analysts’ expectations of $5.94 billion. Southwest Airlines had a net margin of 10.73% and a return on equity of 24.12%. Southwest Airlines’s quarterly revenue was up 2.9% compared to the same quarter last year. During the same period in the prior year, the firm earned $1.26 EPS. Sell-side analysts predict that Southwest Airlines will post 4.27 EPS for the current fiscal year.
The business also recently declared a quarterly dividend, which was paid on Wednesday, September 11th. Investors of record on Wednesday, August 21st were paid a $0.18 dividend. The ex-dividend date of this dividend was Tuesday, August 20th. This represents a $0.72 dividend on an annualized basis and a yield of 1.31%. Southwest Airlines’s dividend payout ratio (DPR) is currently 16.98%.
Institutional investors and hedge funds have recently made changes to their positions in the stock. Nuveen Asset Management LLC grew its position in shares of Southwest Airlines by 333.6% during the 2nd quarter. Nuveen Asset Management LLC now owns 3,739,565 shares of the airline’s stock worth $189,895,000 after purchasing an additional 2,877,170 shares in the last quarter. AQR Capital Management LLC grew its position in shares of Southwest Airlines by 50.7% during the 2nd quarter. AQR Capital Management LLC now owns 5,547,705 shares of the airline’s stock worth $281,712,000 after purchasing an additional 1,865,500 shares in the last quarter. AJO LP grew its position in shares of Southwest Airlines by 9,537.6% during the 1st quarter. AJO LP now owns 1,518,979 shares of the airline’s stock worth $78,850,000 after purchasing an additional 1,503,218 shares in the last quarter. State of Tennessee Treasury Department grew its position in shares of Southwest Airlines by 629.5% during the 1st quarter. State of Tennessee Treasury Department now owns 1,290,943 shares of the airline’s stock worth $67,013,000 after purchasing an additional 1,113,980 shares in the last quarter. Finally, Geode Capital Management LLC grew its position in shares of Southwest Airlines by 13.7% during the 4th quarter. Geode Capital Management LLC now owns 6,706,799 shares of the airline’s stock worth $311,306,000 after purchasing an additional 809,418 shares in the last quarter. 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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