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If You Invested $1000 in Southwest Airlines 10 Years Ago, This Is How Much You'd Have Now
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For most investors, how much a stock's price changes over time is important. Not only can it impact your investment portfolio, but it can also help you compare investment results across sectors and industries.
The fear of missing out, or FOMO, also plays a factor in investing, especially with particular tech giants, as well as popular consumer-facing stocks.
What if you'd invested in Southwest Airlines (LUV - Free Report) ten years ago? It may not have been easy to hold on to LUV for all that time, but if you did, how much would your investment be worth today?
Southwest Airlines' Business In-Depth
With that in mind, let's take a look at Southwest Airlines' main business drivers.
Based in Dallas, TX, Southwest Airlines is a passenger airline that provides scheduled air transportation in the United States and 'ten near-international' markets. The company, incorporated in Texas in 1967, commenced operations on Jun 18, 1971, with three Boeing 737 jets serving the cities of Dallas, Houston and San Antonio.
Per the U.S. Department of Transportation's latest available data, Southwest Airlines has emerged as the largest domestic air carrier (measured in terms of the number of domestic originating passengers boarded) in the United States. During 2018, the carrier commenced operating flights from Indianapolis, San Jose, Sacramento, Columbus, New Orleans, Pittsburgh, and Raleigh-Durham.
Additionally, during 2018, the carrier started shipping cargo to international destinations like Mexico City, Cancun, Cabo San Lucas/Los Cabos, Puerto Vallarta, Montego Bay, and San Jose, Costa Rica.
The company is constantly looking to modernize its fleet. At 2021-end, Southwest Airlines had 728 Boeing 737 jets in its fleet. The carrier used its fleet to serve 121 destinations in 42 states, the District of Columbia, the Commonwealth of Puerto Rico, and ten near-international countries: Mexico, Jamaica, The Bahamas, Aruba, Dominican Republic, Costa Rica, Belize, Cuba, the Cayman Islands, and Turks and Caicos. As part of its expansion efforts, Southwest Airlines started operating flights to Hawaii from March 2019.
Southwest Airlines provides short-haul, high frequency, point-to-point and low-fare services. The company’s point-to-point route structure includes services to and from many secondary or downtown airports such as Dallas Love Field, Houston Hobby, Chicago Midway, Baltimore-Washington International and Ft. Lauderdale-Hollywood. In fact, roughly 73% of the carrier's passengers flew nonstop during 2021. The carrier served 788 non-stop city pairs as of Dec 31, 2021.
The company also offers long-haul nonstop service between markets like Oakland and Orlando, Los Angeles and Nashville, Las Vegas and Orlando, San Diego and Baltimore, Houston and New York LaGuardia, Los Angeles and Tampa, Oakland and Baltimore, San Diego and Newark.
Passenger revenues account for the bulk (89.1% in 2021) of the top line at Southwest Airlines. Freight revenues accounted for 1.2% and the remaining came from other sources.
Bottom Line
Anyone can invest, but building a successful investment portfolio requires research, patience, and a little bit of risk. So, if you had invested in Southwest Airlines ten years ago, you're likely feeling pretty good about your investment today.
A $1000 investment made in May 2012 would be worth $5,693.83, or a gain of 469.38%, as of May 9, 2022, according to our calculations. This return excludes dividends but includes price appreciation.
In comparison, the S&P 500 gained 201.17% and the price of gold went up 12.45% over the same time frame.
Analysts are forecasting more upside for LUV too.
Continued recovery in air-travel demand bodes well for Southwest Airlines. Anticipating continued improvement in bookings, the carrier expects to reap profits in the remaining three quarters of 2022 as well as for the full year. LUV's management predicts operating revenues to increase 8-12% in the second quarter from the comparable period in 2019. Fleet- modernization efforts of LUV are encouraging as well. Southwest Airlines' liquidity position also raises optimism in the stock. However, escalating fuel prices represent a concern. In first-quarter 2022, fuel cost per gallon (inclusive of fuel tax: economic) rose 35.3% year over year to $2.30. Economic fuel costs per gallon are projected to be in the $3.05-$3.15 band in the second quarter. Moreover, increase in labor and airport costs are also likely to dent bottom-line growth.
Shares have gained 11.83% over the past four weeks and there have been 9 higher earnings estimate revisions for fiscal 2022 compared to none lower. The consensus estimate has moved up as well.
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If You Invested $1000 in Southwest Airlines 10 Years Ago, This Is How Much You'd Have Now
For most investors, how much a stock's price changes over time is important. Not only can it impact your investment portfolio, but it can also help you compare investment results across sectors and industries.
The fear of missing out, or FOMO, also plays a factor in investing, especially with particular tech giants, as well as popular consumer-facing stocks.
What if you'd invested in Southwest Airlines (LUV - Free Report) ten years ago? It may not have been easy to hold on to LUV for all that time, but if you did, how much would your investment be worth today?
Southwest Airlines' Business In-Depth
With that in mind, let's take a look at Southwest Airlines' main business drivers.
Based in Dallas, TX, Southwest Airlines is a passenger airline that provides scheduled air transportation in the United States and 'ten near-international' markets. The company, incorporated in Texas in 1967, commenced operations on Jun 18, 1971, with three Boeing 737 jets serving the cities of Dallas, Houston and San Antonio.
Per the U.S. Department of Transportation's latest available data, Southwest Airlines has emerged as the largest domestic air carrier (measured in terms of the number of domestic originating passengers boarded) in the United States. During 2018, the carrier commenced operating flights from Indianapolis, San Jose, Sacramento, Columbus, New Orleans, Pittsburgh, and Raleigh-Durham.
Additionally, during 2018, the carrier started shipping cargo to international destinations like Mexico City, Cancun, Cabo San Lucas/Los Cabos, Puerto Vallarta, Montego Bay, and San Jose, Costa Rica.
The company is constantly looking to modernize its fleet. At 2021-end, Southwest Airlines had 728 Boeing 737 jets in its fleet. The carrier used its fleet to serve 121 destinations in 42 states, the District of Columbia, the Commonwealth of Puerto Rico, and ten near-international countries: Mexico, Jamaica, The Bahamas, Aruba, Dominican Republic, Costa Rica, Belize, Cuba, the Cayman Islands, and Turks and Caicos. As part of its expansion efforts, Southwest Airlines started operating flights to Hawaii from March 2019.
Southwest Airlines provides short-haul, high frequency, point-to-point and low-fare services. The company’s point-to-point route structure includes services to and from many secondary or downtown airports such as Dallas Love Field, Houston Hobby, Chicago Midway, Baltimore-Washington International and Ft. Lauderdale-Hollywood. In fact, roughly 73% of the carrier's passengers flew nonstop during 2021. The carrier served 788 non-stop city pairs as of Dec 31, 2021.
The company also offers long-haul nonstop service between markets like Oakland and Orlando, Los Angeles and Nashville, Las Vegas and Orlando, San Diego and Baltimore, Houston and New York LaGuardia, Los Angeles and Tampa, Oakland and Baltimore, San Diego and Newark.
Passenger revenues account for the bulk (89.1% in 2021) of the top line at Southwest Airlines. Freight revenues accounted for 1.2% and the remaining came from other sources.
Bottom Line
Anyone can invest, but building a successful investment portfolio requires research, patience, and a little bit of risk. So, if you had invested in Southwest Airlines ten years ago, you're likely feeling pretty good about your investment today.
A $1000 investment made in May 2012 would be worth $5,693.83, or a gain of 469.38%, as of May 9, 2022, according to our calculations. This return excludes dividends but includes price appreciation.
In comparison, the S&P 500 gained 201.17% and the price of gold went up 12.45% over the same time frame.
Analysts are forecasting more upside for LUV too.
Continued recovery in air-travel demand bodes well for Southwest Airlines. Anticipating continued improvement in bookings, the carrier expects to reap profits in the remaining three quarters of 2022 as well as for the full year. LUV's management predicts operating revenues to increase 8-12% in the second quarter from the comparable period in 2019. Fleet- modernization efforts of LUV are encouraging as well. Southwest Airlines' liquidity position also raises optimism in the stock. However, escalating fuel prices represent a concern. In first-quarter 2022, fuel cost per gallon (inclusive of fuel tax: economic) rose 35.3% year over year to $2.30. Economic fuel costs per gallon are projected to be in the $3.05-$3.15 band in the second quarter. Moreover, increase in labor and airport costs are also likely to dent bottom-line growth.
Shares have gained 11.83% over the past four weeks and there have been 9 higher earnings estimate revisions for fiscal 2022 compared to none lower. The consensus estimate has moved up as well.