Back to top

Analyst Blog

This page is temporarily not available.  Please check later as it should be available shortly. If you have any questions, please email customer support at or call 800-767-3771 ext.  9339.

Dallas, Texas-based Southwest Airlines Co. (LUV - Analyst Report) witnessed higher traffic and capacity in May 2013. The results were supported by an increased number of passengers traveled and trips conducted.

The company’s traffic – measured in revenue passenger miles (RPMs) – was 9.34 billion for the reported month, up 4.2% from 8.97 billion recorded a year ago. On a year-over-year basis, consolidated capacity (or available seat miles/ASMs) moved up 3.4% to 11.41 billion. The load factor or percentage of seats filled by passengers improved marginally to 81.9% from 81.3% in May 2012.

For the first five months of this year, Southwest generated RPMs of 41.84 billion (up 1.4% year over year) and ASMs of 53.44 billion (up 1.9% year over year). Load factor was 78.3%, reflecting a decline of 40 basis points.

We believe that Southwest remains committed to sustain its brand and operational excellence based on five major strategic actions. The company unveiled an aircraft purchase order restructuring initiative that is expected to induce cost savings in the coming five years. The company switched five orders for The Boeing Company’s (BA - Analyst Report) 737-700 into 737-800s and abandoned a set of five purchase orders of Boeing Next Generation jets each in 2014 and 2015.

In an attempt to enhance shareholder value, Southwest announced a 400% hike in quarterly dividend to 4 cents per share from a penny per share. On an annualized basis, the total amount of dividend payout is expected to be more than $100 million. Additionally, the company also raised its stock repurchase plan to $1.5 billion from the existing program of $1 billion.

Southwest – which operates along with other prominent players such as United Continental Holdings (UAL - Analyst Report) and JetBlue Airways (JBLU - Analyst Report) – currently holds a Zacks Rank #2, implying a Buy rating.

Please login to or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research


Are you a new Zacks Member or a visitor to

Top Zacks Features

Learn more

Start for as little as $4.50 per trade.

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
DIXIE GROUP DXYN 15.84 +7.90%
BOFL HOLDING BOFI 85.30 +4.97%
RAMBUS INC RMBS 12.31 +4.41%
VIPSHOP HOLD VIPS 148.73 +4.35%
NETFLIX INC NFLX 345.74 +4.32%