Southwest Airlines (NYSE:LUV) Posts Quarterly Earnings Results

Southwest Airlines (NYSE:LUV) posted its earnings results on Wednesday. The airline reported $0.58 EPS for the quarter, topping analysts’ consensus estimates of $0.56 by $0.02, FiscalAI reports. The business had revenue of $7.44 billion for the quarter, compared to analysts’ expectations of $7.51 billion. Southwest Airlines had a return on equity of 6.11% and a net margin of 1.57%.The business’s revenue was up 7.4% compared to the same quarter last year. During the same quarter in the previous year, the firm earned $0.56 earnings per share. Southwest Airlines updated its FY 2026 guidance to 4.000- EPS and its Q1 2026 guidance to 0.450- EPS.

Southwest Airlines Price Performance

LUV stock traded up $0.06 during trading on Friday, hitting $48.56. The stock had a trading volume of 3,671,249 shares, compared to its average volume of 9,665,575. Southwest Airlines has a 1-year low of $23.82 and a 1-year high of $49.85. The stock has a market cap of $25.11 billion, a price-to-earnings ratio of 57.83, a price-to-earnings-growth ratio of 0.37 and a beta of 1.16. The company’s 50 day moving average price is $40.42 and its two-hundred day moving average price is $35.14. The company has a debt-to-equity ratio of 0.52, a quick ratio of 0.42 and a current ratio of 0.49.

Southwest Airlines Dividend Announcement

The business also recently disclosed a quarterly dividend, which was paid on Friday, January 16th. Investors of record on Friday, December 26th were given a dividend of $0.18 per share. This represents a $0.72 dividend on an annualized basis and a yield of 1.5%. The ex-dividend date was Friday, December 26th. Southwest Airlines’s dividend payout ratio (DPR) is currently 110.77%.

Institutional Trading of Southwest Airlines

Hedge funds and other institutional investors have recently bought and sold shares of the company. CIBC Private Wealth Group LLC lifted its stake in shares of Southwest Airlines by 3.1% during the 3rd quarter. CIBC Private Wealth Group LLC now owns 15,562 shares of the airline’s stock worth $497,000 after purchasing an additional 462 shares during the period. Captrust Financial Advisors lifted its holdings in shares of Southwest Airlines by 12.9% during the 3rd quarter. Captrust Financial Advisors now owns 80,668 shares of the airline’s stock worth $2,574,000 after acquiring an additional 9,187 shares during the period. Coldstream Capital Management Inc. grew its holdings in Southwest Airlines by 10.2% in the third quarter. Coldstream Capital Management Inc. now owns 7,995 shares of the airline’s stock valued at $255,000 after purchasing an additional 737 shares during the period. Danske Bank A S acquired a new position in Southwest Airlines during the third quarter worth approximately $108,000. Finally, Advisory Services Network LLC acquired a new position in shares of Southwest Airlines in the 3rd quarter valued at $248,000. 80.82% of the stock is owned by hedge funds and other institutional investors.

Southwest Airlines News Summary

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

• Positive Sentiment: Company guidance and transformation — Southwest raised FY?2026 adjusted EPS guidance to at least $4.00 and said its business transformation (new fees, assigned seating) is expected to materially boost profits, a major upward revision vs. 2025 and a primary catalyst for investor enthusiasm. PR Newswire: Southwest reports Q4 and FY2025 results
• Positive Sentiment: Assigned seating and new fees — Management ended open seating and is actively monetizing seat selection/other ancillaries; outlets and analysts flag this as a durable revenue uplift that supports the aggressive 2026 profit target. CNBC: Southwest forecasts surge in 2026 profits
• Positive Sentiment: Bullish analyst moves — Several firms raised price targets and issued upgrades after the quarter and guidance (examples include Morgan Stanley, BMO and TD Cowen), which amplifies buying interest and supports a re?rating of the stock. 24/7 Wall St.: Top analyst research calls
• Neutral Sentiment: Q4 results were mixed — Southwest beat EPS expectations modestly but revenue slightly lagged consensus; operational metrics showed revenue growth and margin improvement, but the beat was small and some line items remain mixed. Zacks: Q4 earnings beat, revenues lag
• Negative Sentiment: Near?term guidance mixed — Q1 2026 EPS guidance of ~$0.45 was below consensus, implying some near?term softness even as full?year guidance is strong; investors must weigh the lumpy early?year outlook vs. the bigger FY tailwind. Southwest press release / guidance details
• Negative Sentiment: Some skeptical/contrarian signals — There was unusual put buying around the print and a few analysts (and firms with lower targets) remain cautious; not all analysts moved bullishly, so upside is not unanimous and volatility can persist. Benzinga: analyst and options activity coverage

Analyst Ratings Changes

Several equities research analysts have recently commented on LUV shares. BMO Capital Markets upgraded Southwest Airlines from a “market perform” rating to an “outperform” rating and upped their price target for the stock from $43.00 to $57.50 in a research note on Friday. Raymond James Financial raised their target price on shares of Southwest Airlines from $42.00 to $49.00 and gave the stock an “outperform” rating in a research note on Friday, December 19th. Citigroup increased their price target on shares of Southwest Airlines from $38.00 to $44.00 and gave the stock a “neutral” rating in a report on Wednesday, January 7th. Sanford C. Bernstein lifted their price objective on Southwest Airlines from $31.00 to $34.00 and gave the company a “market perform” rating in a report on Thursday, November 20th. Finally, Barclays raised Southwest Airlines from an “equal weight” rating to an “overweight” rating and increased their target price for the stock from $34.00 to $56.00 in a research note on Tuesday, December 16th. Seven analysts have rated the stock with a Buy rating, ten have given a Hold rating and four have given a Sell rating to the company’s stock. According to MarketBeat, the company currently has an average rating of “Hold” and an average price target of $44.61.

About Southwest Airlines

Southwest Airlines Co is a U.S.-based low-cost carrier that operates a point-to-point domestic and near-international airline network. Headquartered in Dallas, Texas, the company primarily flies Boeing 737 aircraft and offers no-frills, single-class service designed to keep fares competitive. Southwest’s operating model emphasizes high aircraft utilization, quick turnaround times and an open seating policy, allowing customers to board and select seats on a first-come, first-served basis.

Founded in 1967 by Herb Kelleher and Rollin King as Air Southwest Company, Southwest began commercial service in 1971, initially connecting Dallas, Houston and San Antonio.