Southwest Airlines (NYSE:LUV) Shares Gap Down – Should You Sell?

Southwest Airlines Co. (NYSE:LUV) shares gapped down before the market opened on Tuesday . The stock had previously closed at $33.58, but opened at $32.72. Southwest Airlines shares last traded at $32.48, with a volume of 3,188,446 shares trading hands.

Analyst Ratings Changes

LUV has been the subject of several research reports. Bank of America reaffirmed an “underperform” rating and issued a $31.00 target price (down from $33.00) on shares of Southwest Airlines in a research report on Friday, January 17th. TD Cowen raised their price objective on shares of Southwest Airlines from $25.00 to $28.00 and gave the stock a “hold” rating in a report on Friday, December 6th. Sanford C. Bernstein lifted their target price on shares of Southwest Airlines from $30.00 to $33.00 and gave the company a “market perform” rating in a research report on Wednesday, December 11th. Susquehanna dropped their price target on shares of Southwest Airlines from $38.00 to $34.00 and set a “neutral” rating for the company in a research report on Tuesday, February 4th. Finally, Morgan Stanley restated an “overweight” rating and set a $42.00 price target on shares of Southwest Airlines in a research note on Wednesday, December 11th. Six research analysts have rated the stock with a sell rating, ten have issued a hold rating and four have given a buy rating to the stock. Based on data from MarketBeat.com, the stock presently has an average rating of “Hold” and a consensus target price of $32.32.

Southwest Airlines Trading Down 4.1 %

The company has a quick ratio of 0.85, a current ratio of 0.92 and a debt-to-equity ratio of 0.49. The business’s fifty day moving average is $31.36 and its two-hundred day moving average is $31.60. The firm has a market cap of $19.08 billion, a price-to-earnings ratio of 44.69, a price-to-earnings-growth ratio of 0.97 and a beta of 1.10.

Southwest Airlines (NYSE:LUV) last released its earnings results on Thursday, January 30th. The airline reported $0.56 EPS for the quarter, beating the consensus estimate of $0.45 by $0.11. Southwest Airlines had a return on equity of 5.77% and a net margin of 1.69%. Equities analysts anticipate that Southwest Airlines Co. will post 1.55 earnings per share for the current fiscal year.

Southwest Airlines Announces Dividend

The firm also recently announced a quarterly dividend, which will be paid on Wednesday, April 2nd. Shareholders of record on Wednesday, March 12th will be given a dividend of $0.18 per share. The ex-dividend date of this dividend is Wednesday, March 12th. This represents a $0.72 dividend on an annualized basis and a yield of 2.24%. Southwest Airlines’s payout ratio is presently 100.00%.

Insider Activity

In other Southwest Airlines news, Director C. David Cush bought 5,000 shares of the company’s stock in a transaction on Wednesday, March 12th. The stock was bought at an average price of $30.03 per share, for a total transaction of $150,150.00. Following the transaction, the director now owns 19,011 shares of the company’s stock, valued at approximately $570,900.33. The trade was a 35.69 % increase in their position. The purchase was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. Insiders own 0.33% of the company’s stock.

Institutional Investors Weigh In On Southwest Airlines

A number of institutional investors have recently made changes to their positions in LUV. CWC Advisors LLC. boosted its holdings in Southwest Airlines by 2.4% during the fourth quarter. CWC Advisors LLC. now owns 13,310 shares of the airline’s stock worth $447,000 after buying an additional 311 shares during the last quarter. Mattson Financial Services LLC raised its position in shares of Southwest Airlines by 22.3% in the 4th quarter. Mattson Financial Services LLC now owns 55,458 shares of the airline’s stock valued at $1,864,000 after acquiring an additional 10,123 shares during the period. Alpha Wealth Funds LLC bought a new position in Southwest Airlines during the 4th quarter worth approximately $638,000. Pinnacle Wealth Planning Services Inc. acquired a new position in Southwest Airlines during the fourth quarter valued at approximately $206,000. Finally, Ameriflex Group Inc. bought a new stake in Southwest Airlines in the fourth quarter valued at approximately $131,000. 80.82% of the stock is owned by institutional investors and hedge funds.

About Southwest Airlines

Southwest Airlines Co operates as a passenger airline company that provides scheduled air transportation services in the United States and near-international markets. As of December 31, 2023, the company operated a total fleet of 817 Boeing 737 aircraft; and served 121 destinations in 42 states, the District of Columbia, and the Commonwealth of Puerto Rico, as well as ten near-international countries, including Mexico, Jamaica, the Bahamas, Aruba, the Dominican Republic, Costa Rica, Belize, Cuba, the Cayman Islands, and Turks and Caicos.