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Southwest Airlines (LUV) Stock Moves -0.27%: What You Should Know

·3 min read

In the latest trading session, Southwest Airlines (LUV) closed at $37.43, marking a -0.27% move from the previous day. This change was narrower than the S&P 500's daily loss of 0.67%. Elsewhere, the Dow lost 0.57%, while the tech-heavy Nasdaq lost 0.05%.

Heading into today, shares of the airline had lost 1.55% over the past month, lagging the Transportation sector's gain of 6.21% and the S&P 500's gain of 3.65% in that time.

Wall Street will be looking for positivity from Southwest Airlines as it approaches its next earnings report date. In that report, analysts expect Southwest Airlines to post earnings of $0.54 per share. This would mark year-over-year growth of 334.78%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $6.29 billion, up 34.47% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $2.26 per share and revenue of $24.18 billion, which would represent changes of +205.12% and +53.12%, respectively, from the prior year.

Any recent changes to analyst estimates for Southwest Airlines should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 16.82% lower. Southwest Airlines is currently a Zacks Rank #3 (Hold).

In terms of valuation, Southwest Airlines is currently trading at a Forward P/E ratio of 16.64. This valuation marks a premium compared to its industry's average Forward P/E of 13.23.

Also, we should mention that LUV has a PEG ratio of 2.77. 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. LUV's industry had an average PEG ratio of 1.78 as of yesterday's close.

The Transportation - Airline industry is part of the Transportation sector. This group has a Zacks Industry Rank of 134, putting it in the bottom 47% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow LUV in the coming trading sessions, be sure to utilize Zacks.com.

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