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Southwest Airlines (LUV) Dips More Than Broader Markets: What You Should Know
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Southwest Airlines (LUV - Free Report) closed the most recent trading day at $36.36, moving -1.84% from the previous trading session. This change lagged the S&P 500's daily loss of 0.1%. Elsewhere, the Dow gained 0.33%, while the tech-heavy Nasdaq lost 5.8%.
Prior to today's trading, shares of the airline had gained 9.04% over the past month. This has outpaced the Transportation sector's gain of 7.23% and the S&P 500's gain of 3.39% 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 July 27, 2023. The company is expected to report EPS of $1.06, down 18.46% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $6.97 billion, up 3.66% from the prior-year quarter.
For the full year, our Zacks Consensus Estimates are projecting earnings of $2.62 per share and revenue of $26.68 billion, which would represent changes of +125.86% and +12.03%, respectively, from the prior year.
It is also important to note the recent changes to analyst estimates for Southwest Airlines. These recent revisions tend to reflect the evolving nature of short-term business trends. 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. 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 0.32% higher. Southwest Airlines currently has a Zacks Rank of #3 (Hold).
Valuation is also important, so investors should note that Southwest Airlines has a Forward P/E ratio of 14.14 right now. Its industry sports an average Forward P/E of 11.72, so we one might conclude that Southwest Airlines is trading at a premium comparatively.
Investors should also note that LUV has a PEG ratio of 0.44 right now. 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 0.29 at yesterday's closing price.
The Transportation - Airline industry is part of the Transportation sector. This industry currently has a Zacks Industry Rank of 41, which puts it in the top 17% 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.
To follow LUV in the coming trading sessions, be sure to utilize Zacks.com.
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Southwest Airlines (LUV) Dips More Than Broader Markets: What You Should Know
Southwest Airlines (LUV - Free Report) closed the most recent trading day at $36.36, moving -1.84% from the previous trading session. This change lagged the S&P 500's daily loss of 0.1%. Elsewhere, the Dow gained 0.33%, while the tech-heavy Nasdaq lost 5.8%.
Prior to today's trading, shares of the airline had gained 9.04% over the past month. This has outpaced the Transportation sector's gain of 7.23% and the S&P 500's gain of 3.39% 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 July 27, 2023. The company is expected to report EPS of $1.06, down 18.46% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $6.97 billion, up 3.66% from the prior-year quarter.
For the full year, our Zacks Consensus Estimates are projecting earnings of $2.62 per share and revenue of $26.68 billion, which would represent changes of +125.86% and +12.03%, respectively, from the prior year.
It is also important to note the recent changes to analyst estimates for Southwest Airlines. These recent revisions tend to reflect the evolving nature of short-term business trends. 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. 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 0.32% higher. Southwest Airlines currently has a Zacks Rank of #3 (Hold).
Valuation is also important, so investors should note that Southwest Airlines has a Forward P/E ratio of 14.14 right now. Its industry sports an average Forward P/E of 11.72, so we one might conclude that Southwest Airlines is trading at a premium comparatively.
Investors should also note that LUV has a PEG ratio of 0.44 right now. 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 0.29 at yesterday's closing price.
The Transportation - Airline industry is part of the Transportation sector. This industry currently has a Zacks Industry Rank of 41, which puts it in the top 17% 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.
To follow LUV in the coming trading sessions, be sure to utilize Zacks.com.