Southwest Airlines (NYSE:LUV) Hits New 1-Year High After Analyst Upgrade

Southwest Airlines Co. (NYSE:LUV)’s stock price reached a new 52-week high during mid-day trading on Wednesday after UBS Group upgraded the stock from a neutral rating to a buy rating. UBS Group now has a $73.00 price target on the stock, up from their previous price target of $51.00. Southwest Airlines traded as high as $55.11 and last traded at $54.18, with a volume of 12953986 shares. The stock had previously closed at $51.11.

A number of other brokerages have also weighed in on LUV. TD Cowen lifted their price objective on Southwest Airlines from $42.00 to $50.00 and gave the company a “hold” rating in a report on Friday, January 30th. The Goldman Sachs Group lifted their price target on Southwest Airlines from $29.00 to $32.00 and gave the company a “sell” rating in a research note on Friday, January 30th. BNP Paribas Exane increased their price objective on Southwest Airlines from $19.00 to $24.00 and gave the stock an “underperform” rating in a research report on Monday, December 8th. Bank of America raised their target price on Southwest Airlines from $37.00 to $42.00 and gave the company an “underperform” rating in a report on Friday, January 30th. Finally, Wall Street Zen raised shares of Southwest Airlines from a “hold” rating to a “buy” rating in a research note on Saturday, February 7th. One research analyst has rated the stock with a Strong Buy rating, seven have given a Buy rating, nine have assigned a Hold rating and three have issued a Sell rating to the stock. According to MarketBeat.com, Southwest Airlines has a consensus rating of “Hold” and a consensus target price of $48.14.

Southwest Airlines News Roundup

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

• Positive Sentiment: UBS upgraded LUV from Neutral to Buy and raised its 12‑month price target to $73 (from $51), citing meaningful earnings upside from the carrier’s seating and fee initiatives — a direct driver of today’s rally. UBS upgrade report
• Positive Sentiment: Southwest announced an overhaul introducing assigned seats, checked‑bag fees, extra‑legroom options and plans for Starlink Wi‑Fi — changes designed to lift ancillary revenue and margins if executed well. Overhaul details
• Positive Sentiment: Analysts and commentary (Zacks and others) point to upward earnings‑estimate revisions and improving fundamentals that support further share gains if execution continues. Zacks analysis
• Neutral Sentiment: Market context: coverage pieces and pre‑market movers stories (Benzinga/MSN) amplified the reaction, so some of today’s move reflects headlines and momentum rather than fresh company results. Market movers writeup
• Negative Sentiment: Risks include execution and customer reaction to fees, plus Southwest’s recent quarterly revenue slightly missed consensus and margins remain thin — meaning upside depends on successful rollout and mix improvement. Notes on risks and results

Hedge Funds Weigh In On Southwest Airlines

Hedge funds have recently added to or reduced their stakes in the business. Elevation Point Wealth Partners LLC acquired a new position in shares of Southwest Airlines during the 2nd quarter worth approximately $25,000. GHP Investment Advisors Inc. acquired a new position in shares of Southwest Airlines in the fourth quarter worth $26,000. Entrust Financial LLC purchased a new stake in shares of Southwest Airlines in the fourth quarter valued at $26,000. Los Angeles Capital Management LLC acquired a new stake in shares of Southwest Airlines during the fourth quarter valued at $26,000. Finally, Corsicana & Co. purchased a new stake in Southwest Airlines during the 3rd quarter worth about $27,000. 80.82% of the stock is currently owned by hedge funds and other institutional investors.

Southwest Airlines Trading Up 6.0%

The stock has a market cap of $26.62 billion, a PE ratio of 64.50, a PEG ratio of 0.36 and a beta of 1.15. The company has a debt-to-equity ratio of 0.57, a quick ratio of 0.45 and a current ratio of 0.52. The business has a 50-day moving average of $44.66 and a 200 day moving average of $36.73.

Southwest Airlines (NYSE:LUV) last released its quarterly earnings results on Wednesday, January 28th. The airline reported $0.58 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.56 by $0.02. The company had revenue of $7.44 billion for the quarter, compared to analysts’ expectations of $7.51 billion. Southwest Airlines had a net margin of 1.57% and a return on equity of 6.18%. The firm’s revenue for the quarter was up 7.4% compared to the same quarter last year. During the same period last year, the company earned $0.56 EPS. Southwest Airlines has set its FY 2026 guidance at 4.000- EPS and its Q1 2026 guidance at 0.450- EPS. Equities research analysts predict that Southwest Airlines Co. will post 1.55 EPS for the current fiscal year.

Southwest Airlines Dividend Announcement

The firm also recently declared a quarterly dividend, which will be paid on Thursday, April 2nd. Shareholders of record on Thursday, March 12th will be paid a $0.18 dividend. This represents a $0.72 dividend on an annualized basis and a yield of 1.3%. The ex-dividend date of this dividend is Thursday, March 12th. Southwest Airlines’s dividend payout ratio (DPR) is presently 85.71%.

Southwest Airlines Company Profile

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.