Southwest Airlines Co. (NYSE:LUV) Sees Significant Drop in Short Interest

Southwest Airlines Co. (NYSE:LUV) was the recipient of a large decline in short interest in the month of September. As of September 15th, there was short interest totalling 43,280,000 shares, a decline of 17.2% from the August 31st total of 52,240,000 shares. Based on an average daily volume of 10,160,000 shares, the short-interest ratio is presently 4.3 days.

Analyst Upgrades and Downgrades

A number of equities analysts have issued reports on LUV shares. Citigroup lowered their price target on Southwest Airlines from $29.00 to $28.25 and set a “neutral” rating on the stock in a research report on Monday, July 29th. TD Cowen dropped their target price on shares of Southwest Airlines from $26.00 to $19.00 and set a “hold” rating on the stock in a research report on Wednesday, July 17th. Evercore ISI upgraded shares of Southwest Airlines from an “in-line” rating to an “outperform” rating and upped their price target for the stock from $30.00 to $35.00 in a research report on Tuesday, September 3rd. Deutsche Bank Aktiengesellschaft reaffirmed a “hold” rating and issued a $29.00 price target (down from $32.00) on shares of Southwest Airlines in a research note on Friday, July 26th. Finally, BNP Paribas raised shares of Southwest Airlines to a “strong sell” rating in a research note on Thursday, September 19th. Four equities research analysts have rated the stock with a sell rating, nine have assigned a hold rating and four have issued a buy rating to the company. Based on data from MarketBeat.com, the company presently has a consensus rating of “Hold” and a consensus target price of $28.38.

Southwest Airlines Stock Performance

NYSE:LUV opened at $29.53 on Monday. The company has a market cap of $17.67 billion, a price-to-earnings ratio of 46.87, a price-to-earnings-growth ratio of 27.03 and a beta of 1.16. The company has a quick ratio of 0.85, a current ratio of 0.90 and a debt-to-equity ratio of 0.48. Southwest Airlines has a 52 week low of $21.91 and a 52 week high of $35.18. The company has a fifty day simple moving average of $27.66 and a two-hundred day simple moving average of $27.86.

Southwest Airlines (NYSE:LUV) last announced its quarterly earnings data on Thursday, July 25th. The airline reported $0.58 earnings per share (EPS) for the quarter, beating the consensus estimate of $0.51 by $0.07. Southwest Airlines had a return on equity of 5.92% and a net margin of 0.41%. The business had revenue of $7.40 billion during the quarter, compared to analysts’ expectations of $7.32 billion. During the same quarter last year, the business posted $1.09 EPS. The business’s quarterly revenue was up 5.2% compared to the same quarter last year. As a group, equities analysts anticipate that Southwest Airlines will post 0.24 earnings per share for the current fiscal year.

Southwest Airlines Announces Dividend

The company also recently disclosed a quarterly dividend, which was paid on Wednesday, September 25th. Stockholders of record on Wednesday, September 4th were issued a $0.18 dividend. The ex-dividend date was Wednesday, September 4th. This represents a $0.72 dividend on an annualized basis and a dividend yield of 2.44%. Southwest Airlines’s payout ratio is 114.29%.

Hedge Funds Weigh In On Southwest Airlines

A number of institutional investors and hedge funds have recently modified their holdings of LUV. Vanguard Group Inc. lifted its holdings in Southwest Airlines by 3.3% during the 1st quarter. Vanguard Group Inc. now owns 67,569,773 shares of the airline’s stock worth $1,972,362,000 after buying an additional 2,148,435 shares during the last quarter. Capital World Investors increased its stake in Southwest Airlines by 14.9% in the first quarter. Capital World Investors now owns 61,422,187 shares of the airline’s stock valued at $1,792,914,000 after purchasing an additional 7,946,199 shares during the last quarter. Dimensional Fund Advisors LP increased its stake in Southwest Airlines by 21.6% in the second quarter. Dimensional Fund Advisors LP now owns 5,828,166 shares of the airline’s stock valued at $166,742,000 after purchasing an additional 1,034,496 shares during the last quarter. Kiltearn Partners LLP raised its holdings in Southwest Airlines by 0.5% during the fourth quarter. Kiltearn Partners LLP now owns 2,468,983 shares of the airline’s stock worth $71,304,000 after purchasing an additional 12,000 shares in the last quarter. Finally, Healthcare of Ontario Pension Plan Trust Fund purchased a new stake in shares of Southwest Airlines during the 2nd quarter worth approximately $48,551,000. Institutional investors and hedge funds own 80.82% of the company’s stock.

Southwest Airlines Company Profile

Southwest Airlines Co operates as a passenger airline company that provides scheduled air transportation services in the United States and near-international markets. As of December 31, 2023, the company operated a total fleet of 817 Boeing 737 aircraft; and served 121 destinations in 42 states, the District of Columbia, and the Commonwealth of Puerto Rico, as well as ten near-international countries, including Mexico, Jamaica, the Bahamas, Aruba, the Dominican Republic, Costa Rica, Belize, Cuba, the Cayman Islands, and Turks and Caicos.