Southwest Airlines (NYSE:LUV) Issues FY 2026 Earnings Guidance

Southwest Airlines (NYSE:LUV) updated its FY 2026 earnings guidance on Friday. The company provided earnings per share (EPS) guidance of 2.600-2.850 for the period, compared to the consensus EPS estimate of 2.850. Southwest Airlines also updated its Q4 2026 guidance to 0.550-0.800 EPS.

Southwest Airlines Trading Down 2.1%

Shares of LUV traded down $0.86 during trading hours on Friday, reaching $41.16. 3,604,962 shares of the company traded hands, compared to its average volume of 7,424,783. The firm has a market cap of $20.14 billion, a price-to-earnings ratio of 25.29, a PEG ratio of 1.06 and a beta of 1.16. Southwest Airlines has a 12-month low of $29.26 and a 12-month high of $55.11. The company has a current ratio of 0.49, a quick ratio of 0.42 and a debt-to-equity ratio of 0.54. The stock’s fifty day moving average price is $40.62 and its 200 day moving average price is $42.89.

Southwest Airlines (NYSE:LUV) last announced its quarterly earnings data on Wednesday, October 21st. The airline reported $0.66 earnings per share for the quarter, beating analysts’ consensus estimates of $0.57 by $0.09. The company had revenue of $8.42 billion during the quarter, compared to analyst estimates of $8.25 billion. Southwest Airlines had a net margin of 3.34% and a return on equity of 18.07%. The firm’s revenue for the quarter was up 21.2% on a year-over-year basis. During the same quarter last year, the business posted $0.11 EPS. Sell-side analysts forecast that Southwest Airlines will post 2.91 earnings per share for the current year.

Southwest Airlines Dividend Announcement

The company also recently declared a quarterly dividend, which was paid on Thursday, September 24th. Investors of record on Thursday, September 3rd were issued a $0.18 dividend. The ex-dividend date was Thursday, September 3rd. This represents a $0.72 dividend on an annualized basis and a dividend yield of 1.7%. Southwest Airlines’s payout ratio is presently 44.17%.

Analyst Upgrades and Downgrades

Several equities research analysts have recently commented on LUV shares. Bank of America boosted their price target on shares of Southwest Airlines from $40.00 to $45.00 and gave the company an “underperform” rating in a report on Wednesday, July 1st. Barclays cut their price objective on shares of Southwest Airlines from $65.00 to $58.00 and set an “overweight” rating on the stock in a report on Friday, September 11th. Citigroup reduced their price objective on shares of Southwest Airlines from $55.00 to $50.00 and set a “neutral” rating for the company in a research note on Friday, July 24th. JPMorgan Chase & Co. cut their price objective on shares of Southwest Airlines from $60.00 to $59.00 and set an “overweight” rating on the stock in a research report on Friday, July 24th. Finally, Rothschild & Co Redburn raised shares of Southwest Airlines from a “sell” rating to a “neutral” rating and lifted their price target for the stock from $35.00 to $40.00 in a report on Friday, September 18th. Nine analysts have rated the stock with a Buy rating, nine have given a Hold rating and four have assigned a Sell rating to the stock. According to MarketBeat, the stock has an average rating of “Hold” and a consensus target price of $47.41.

Southwest Airlines News Roundup

Here are the key news stories impacting Southwest Airlines this week:

• Positive Sentiment: Southwest reported record third-quarter revenue of approximately $8.42 billion, up 21.2% year over year. Adjusted EPS of $0.66 exceeded the roughly $0.57 consensus estimate, while revenue per available seat mile increased 21.6% and the operating margin expanded to 4.5%. LUV Q3 Earnings Beat on Record Revenues and Higher Fares
• Positive Sentiment: Strong fares, passenger demand and ancillary revenue helped Southwest expand margins despite substantially higher operating costs. Management also indicated that fourth-quarter unit revenue could rise 19% to 21% year over year. Southwest Airlines posts record revenue as fuel costs surge
• Neutral Sentiment: Wells Fargo initiated a Hold rating, while Susquehanna reduced its price target to $43 from $45, signaling limited near-term upside relative to the recent share price. Susquehanna Adjusts Price Target on Southwest Airlines
• Negative Sentiment: Southwest lowered its full-year 2026 adjusted EPS guidance to $2.60–$2.85, versus a $2.85 analyst consensus. Fourth-quarter adjusted EPS guidance of $0.55–$0.80 is also below the $0.88 consensus estimate. Southwest Airlines cuts 2026 profit forecast on higher fuel
• Negative Sentiment: Fuel expense increased by $821 million year over year, and management said it is planning for elevated jet-fuel prices to persist into 2027. The combination of higher fuel costs and cautious analyst sentiment is outweighing the strong quarterly results for investors today. US airlines favor higher fares over fuller planes as fuel costs squeeze profits

About Southwest Airlines

Southwest Airlines Co is a major U.S. passenger airline headquartered in Dallas, Texas. The company provides scheduled air transportation for leisure and business travelers, with service connecting cities throughout the United States and selected destinations in Mexico, the Caribbean, and Central America.

Southwest is known for its predominantly domestic network and point-to-point operating model. In addition to passenger flights, the company offers ancillary services and air cargo transportation.