Southwest Airlines (NYSE:LUV) Shares Down 4.5% – Should You Sell?

Southwest Airlines Co. (NYSE:LUV) traded down 4.5% during trading on Thursday . The company traded as low as $31.31 and last traded at $31.33. 2,290,800 shares changed hands during mid-day trading, a decline of 62% from the average session volume of 5,982,328 shares. The stock had previously closed at $32.80.

Wall Street Analysts Forecast Growth

LUV has been the subject of a number of recent research reports. TD Cowen raised their price target on shares of Southwest Airlines from $25.00 to $28.00 and gave the stock a “hold” rating in a research report on Friday, December 6th. StockNews.com upgraded shares of Southwest Airlines from a “sell” rating to a “hold” rating in a research report on Monday, October 28th. Jefferies Financial Group raised Southwest Airlines from an “underperform” rating to a “hold” rating and increased their price target for the stock from $24.00 to $32.00 in a research report on Wednesday, October 9th. Bank of America reissued an “underperform” rating and issued a $31.00 price objective (down previously from $33.00) on shares of Southwest Airlines in a report on Friday. Finally, Sanford C. Bernstein raised their target price on Southwest Airlines from $30.00 to $33.00 and gave the stock a “market perform” rating in a report on Wednesday, December 11th. Six equities research analysts have rated the stock with a sell rating, ten have given a hold rating and three have issued a buy rating to the company’s stock. According to data from MarketBeat.com, Southwest Airlines has an average rating of “Hold” and an average price target of $32.31.

Southwest Airlines Stock Up 0.1 %

The firm has a market cap of $19.31 billion, a PE ratio of -459.90, a PEG ratio of 3.27 and a beta of 1.14. The business’s 50 day moving average price is $33.01 and its 200 day moving average price is $30.10. The company has a debt-to-equity ratio of 0.49, a current ratio of 0.88 and a quick ratio of 0.83.

Southwest Airlines (NYSE:LUV) last released its earnings results on Thursday, October 24th. The airline reported $0.15 earnings per share for the quarter, beating the consensus estimate of $0.05 by $0.10. Southwest Airlines had a positive return on equity of 4.56% and a negative net margin of 0.06%. The business had revenue of $6.87 billion for the quarter, compared to the consensus estimate of $6.77 billion. During the same quarter last year, the business posted $0.38 earnings per share. The business’s quarterly revenue was up 5.3% compared to the same quarter last year. On average, equities research analysts expect that Southwest Airlines Co. will post 0.81 earnings per share for the current year.

Southwest Airlines Announces Dividend

The firm also recently declared a quarterly dividend, which was paid on Thursday, January 16th. Stockholders of record on Thursday, December 26th were paid a $0.18 dividend. This represents a $0.72 annualized dividend and a dividend yield of 2.24%. The ex-dividend date was Thursday, December 26th. Southwest Airlines’s dividend payout ratio is currently -1,028.57%.

Insider Buying and Selling

In other news, major shareholder Elliott Investment Management sold 1,203,920 shares of the business’s stock in a transaction dated Monday, October 28th. The shares were sold at an average price of $29.83, for a total transaction of $35,912,933.60. Following the transaction, the insider now owns 59,912,580 shares of the company’s stock, valued at approximately $1,787,192,261.40. The trade was a 1.97 % decrease in their position. The sale was disclosed in a legal filing with the SEC, which can be accessed through this link. Also, insider Linda B. Rutherford sold 3,849 shares of the firm’s stock in a transaction dated Friday, December 6th. The stock was sold at an average price of $34.40, for a total transaction of $132,405.60. Following the sale, the insider now owns 89,376 shares of the company’s stock, valued at approximately $3,074,534.40. The trade was a 4.13 % decrease in their ownership of the stock. The disclosure for this sale can be found here. 0.33% of the stock is currently owned by company insiders.

Institutional Trading of Southwest Airlines

Several hedge funds have recently made changes to their positions in LUV. Hedges Asset Management LLC lifted its holdings in Southwest Airlines by 2.5% in the fourth quarter. Hedges Asset Management LLC now owns 136,700 shares of the airline’s stock valued at $4,596,000 after acquiring an additional 3,300 shares during the last quarter. Avior Wealth Management LLC grew its holdings in shares of Southwest Airlines by 3.8% during the 4th quarter. Avior Wealth Management LLC now owns 10,116 shares of the airline’s stock worth $340,000 after purchasing an additional 369 shares during the period. Raleigh Capital Management Inc. increased its position in shares of Southwest Airlines by 186.7% during the 4th quarter. Raleigh Capital Management Inc. now owns 883 shares of the airline’s stock worth $30,000 after purchasing an additional 575 shares during the last quarter. Janney Montgomery Scott LLC raised its holdings in Southwest Airlines by 10.0% in the 4th quarter. Janney Montgomery Scott LLC now owns 10,551 shares of the airline’s stock valued at $355,000 after buying an additional 962 shares during the period. Finally, MBM Wealth Consultants LLC lifted its position in Southwest Airlines by 11.4% in the fourth quarter. MBM Wealth Consultants LLC now owns 16,352 shares of the airline’s stock valued at $546,000 after buying an additional 1,676 shares during the last quarter. Hedge funds and other institutional investors 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.