Southwest Airlines Co. (NYSE:LUV) Receives Consensus Rating of “Hold” from Analysts

Shares of Southwest Airlines Co. (NYSE:LUV) have received an average recommendation of “Hold” from the twenty ratings firms that are presently covering the company, MarketBeat reports. Three equities research analysts have rated the stock with a sell rating, eight have assigned a hold rating, eight have issued a buy rating and one has assigned a strong buy rating to the company. The average twelve-month target price among brokers that have issued a report on the stock in the last year is $49.0278.

LUV has been the topic of a number of research analyst reports. BMO Capital Markets upgraded shares of Southwest Airlines from a “market perform” rating to an “outperform” rating and raised their price objective for the stock from $43.00 to $57.50 in a report on Friday, January 30th. Raymond James Financial lifted their price target on Southwest Airlines from $42.00 to $49.00 and gave the company an “outperform” rating in a research note on Friday, December 19th. TD Cowen upgraded Southwest Airlines from a “hold” rating to a “buy” rating and boosted their price target for the company from $50.00 to $66.00 in a report on Friday. Citigroup increased their price objective on Southwest Airlines from $44.00 to $54.00 in a report on Tuesday, February 3rd. Finally, UBS Group upgraded Southwest Airlines from a “neutral” rating to a “buy” rating and boosted their target price for the company from $51.00 to $73.00 in a research note on Tuesday, February 17th.

Southwest Airlines Trading Down 3.4%

NYSE:LUV opened at $49.20 on Monday. Southwest Airlines has a fifty-two week low of $23.82 and a fifty-two week high of $55.11. The company has a debt-to-equity ratio of 0.57, a current ratio of 0.52 and a quick ratio of 0.45. The stock has a market capitalization of $24.17 billion, a PE ratio of 58.57, a price-to-earnings-growth ratio of 0.35 and a beta of 1.10. The business’s 50-day simple moving average is $46.30 and its 200-day simple moving average is $37.93.

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

Southwest Airlines Dividend Announcement

The firm also recently disclosed a quarterly dividend, which will be paid on Thursday, April 2nd. Stockholders of record on Thursday, March 12th will be given a $0.18 dividend. This represents a $0.72 dividend on an annualized basis and a dividend yield of 1.5%. The ex-dividend date of this dividend is Thursday, March 12th. Southwest Airlines’s payout ratio is currently 85.71%.

Key Stories Impacting Southwest Airlines

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

• Positive Sentiment: Management’s overhaul and 2026 guidance are supporting investor confidence — coverage notes the transformation and clearer FY‑2026 targets that helped lift sentiment. A Look At Southwest Airlines (LUV) Valuation As Its Overhaul And 2026 Guidance Boost Investor Confidence
• Positive Sentiment: Product changes (assigned seating, extra‑legroom options, expanded distribution, free Wi‑Fi for Rapid Rewards) plus a large 2025 shareholder return (~$2.9B) are reframing Southwest from a low‑cost carrier to a differentiated, revenue‑enhancing operator. Is Southwest’s Bold Shift To Assigned Seating And Perks Altering The Investment Case For LUV?
• Positive Sentiment: TD Cowen upgraded LUV from Hold to Buy with a $66 price target, signaling analyst optimism and adding potential upside from improved sentiment and coverage. Benzinga note on TD Cowen upgrade
• Positive Sentiment: Short interest dropped meaningfully in February (≈22.6% decline), reducing immediate short‑pressure and indicating some bearish positions have been covered. (Market data summarized publicly.)
• Neutral Sentiment: Recent earnings showed a modest EPS beat but a revenue miss; market reaction since the report has been positive overall (LUV up ~5% since earnings), but investors are now parsing forward guidance and execution risks. Why Is Southwest (LUV) Up 5% Since Last Earnings Report?
• Neutral Sentiment: Analysts and commentators are debating valuation — some see LUV as still attractive given execution and margin upside, while others flag stretched momentum after the recent run. Are Investors Undervaluing Southwest Airlines (LUV) Right Now?
• Negative Sentiment: Sector headwinds: rising crude oil and broader airline weakness (notably United and Delta share drops) are pressuring airline multiples and can offset Southwest’s company‑level gains. United Airlines, Delta Stocks Fall. Why Airlines Are Getting Crushed.
• Negative Sentiment: Investor caution remains because higher industry labor costs and legacy carriers’ balance‑sheet issues keep the sector sensitive to macro shocks, which can trigger short‑term pullbacks even for stronger operators. AAL Benefits From Improved Air-Travel Demand Amid High Costs

Institutional Investors Weigh In On Southwest Airlines

Several hedge funds and other institutional investors 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 about $25,000. GHP Investment Advisors Inc. bought a new position in Southwest Airlines in the fourth quarter valued at approximately $26,000. Entrust Financial LLC bought a new position in Southwest Airlines in the fourth quarter valued at approximately $26,000. Los Angeles Capital Management LLC acquired a new position in shares of Southwest Airlines during the 4th quarter worth approximately $26,000. Finally, Corsicana & Co. bought a new stake in shares of Southwest Airlines during the 3rd quarter worth approximately $27,000. 80.82% of the stock is currently owned by institutional investors and hedge funds.

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.