Southwest Airlines (NYSE:LUV) Rating Lowered to “Strong Sell” at Zacks Research

Southwest Airlines (NYSE:LUV) was downgraded by analysts at Zacks Research from a “hold” rating to a “strong sell” rating in a research note issued to investors on Tuesday, Zacks reports.

Several other research analysts have also commented on LUV. Barclays cut their price target on shares of Southwest Airlines from $65.00 to $58.00 and set an “overweight” rating on the stock in a report on Friday, September 11th. 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. Citigroup reduced their target price on shares of Southwest Airlines from $55.00 to $50.00 and set a “neutral” rating on the stock in a report on Friday, July 24th. The Goldman Sachs Group upped their price target on shares of Southwest Airlines from $30.00 to $35.00 and gave the stock a “sell” rating in a research report on Thursday, July 2nd. Finally, Rothschild & Co Redburn upgraded Southwest Airlines from a “sell” rating to a “neutral” rating and increased their price target for the company from $35.00 to $40.00 in a report on Friday, September 18th. Nine investment analysts have rated the stock with a Buy rating, nine have given a Hold rating and four have issued a Sell rating to the company’s stock. According to data from MarketBeat, Southwest Airlines presently has an average rating of “Hold” and a consensus price target of $47.45.

Southwest Airlines Stock Performance

Shares of NYSE:LUV opened at $41.77 on Tuesday. The firm has a market capitalization of $20.43 billion, a PE ratio of 25.62, a P/E/G ratio of 0.41 and a beta of 1.16. The company has a debt-to-equity ratio of 0.54, a current ratio of 0.49 and a quick ratio of 0.42. The business has a 50-day moving average of $41.92 and a two-hundred day moving average of $42.75. Southwest Airlines has a 12 month low of $29.26 and a 12 month high of $55.11.

Southwest Airlines (NYSE:LUV) last released its quarterly earnings data on Wednesday, July 22nd. The airline reported $0.94 earnings per share for the quarter, beating the consensus estimate of $0.52 by $0.42. Southwest Airlines had a return on equity of 14.15% and a net margin of 2.78%.The business had revenue of $8.72 billion for the quarter, compared to analyst estimates of $8.58 billion. During the same period in the previous year, the company posted $0.43 EPS. The company’s 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. As a group, research analysts forecast that Southwest Airlines will post 3.16 earnings per share for the current year.

Institutional Inflows and Outflows

A number of institutional investors and hedge funds have recently bought and sold shares of the business. SHP Wealth Management purchased a new stake in Southwest Airlines during the 4th quarter worth approximately $25,000. Scarborough Advisors LLC purchased a new position in shares of Southwest Airlines during the 1st quarter valued at approximately $28,000. Fiduciary Financial Advisors purchased a new position in shares of Southwest Airlines during the 2nd quarter valued at approximately $32,000. Archer Investment Corp acquired a new stake in shares of Southwest Airlines during the second quarter worth approximately $32,000. Finally, MidFirst Bank acquired a new stake in shares of Southwest Airlines during the fourth quarter worth approximately $39,000. Hedge funds and other institutional investors own 80.82% of the company’s stock.

More Southwest Airlines News

Here are the key news stories impacting Southwest Airlines this week:

• Positive Sentiment: Southwest launched a first-of-its-kind U.S. airline plugin in ChatGPT, developed with OpenAI and Amazon Web Services. The tool lets travelers discover destinations, plan trips and shop for Southwest flights earlier in the booking process, potentially improving customer engagement and direct sales. Southwest Airlines launches first-of-its-kind U.S. airline plugin in ChatGPT
• Neutral Sentiment: Susquehanna lowered its Southwest price target from $50 to $45 and moved to a neutral rating. Although the revised target implies potential upside from the current trading level, the reduction signals more limited analyst confidence in the stock’s near-term appreciation.
• Neutral Sentiment: Citi assigned Southwest a hold rating, adding to a cautious analyst outlook rather than providing a catalyst for buyers. Southwest Airlines receives a hold from Citi
• Negative Sentiment: Bank of America Securities reaffirmed its sell rating on LUV, reinforcing concerns about Southwest’s earnings outlook and operating performance. Bank of America Securities reaffirms sell rating on Southwest Airlines
• Negative Sentiment: Southwest was added to the Zacks Rank #5 “Strong Sell” list, increasing the stock’s near-term technical and sentiment pressure. New Strong Sell Stocks for October 7th
• Negative Sentiment: Airline shares are facing broader short-selling pressure as higher oil and gasoline prices raise fuel-cost and consumer-demand concerns. Investors appear to be treating energy prices and ongoing geopolitical risks as threats to airline margins.

About Southwest Airlines

Southwest Airlines Co is a U.S. commercial airline headquartered in Dallas, Texas, and listed on the New York Stock Exchange under the symbol LUV. The company was founded in 1967 and began operating scheduled passenger service in 1971, initially serving cities in Texas before expanding across the United States.

Southwest primarily provides scheduled air transportation for passengers and also offers air cargo services. Its operations are centered on a large Boeing 737 fleet, supporting frequent service between major cities and regional airports.