Southwest Airlines (LUV) closed the most recent trading day at $36.74, making no change from the previous trading session. This change was narrower than the S&P 500's 0.41% loss on the day. Meanwhile, the Dow lost 0.55%, and the Nasdaq, a tech-heavy index, added 0.1%.
Prior to today's trading, shares of the airline had lost 5.99% over the past month. This has lagged the Transportation sector's loss of 4.48% and the S&P 500's loss of 5.13% in that time.
Wall Street will be looking for positivity from Southwest Airlines as it approaches its next earnings report date. This is expected to be October 27, 2022. The company is expected to report EPS of $0.54, up 334.78% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $6.29 billion, up 34.53% from the prior-year quarter.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $2.26 per share and revenue of $24.18 billion. These totals would mark changes of +205.12% and +53.12%, respectively, from last year.
Investors might also notice recent changes to analyst estimates for Southwest Airlines. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 3.07% lower. Southwest Airlines is currently sporting a Zacks Rank of #3 (Hold).
Valuation is also important, so investors should note that Southwest Airlines has a Forward P/E ratio of 16.28 right now. For comparison, its industry has an average Forward P/E of 13.29, which means Southwest Airlines is trading at a premium to the group.
We can also see that LUV currently has a PEG ratio of 2.71. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Transportation - Airline was holding an average PEG ratio of 1.74 at yesterday's closing price.
The Transportation - Airline industry is part of the Transportation sector. This industry currently has a Zacks Industry Rank of 93, which puts it in the top 37% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
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Southwest Airlines Co. (LUV) : Free Stock Analysis Report
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