Daily High to Daily Low: Is It Safe to Buy Southwest Airlines Co. (LUV)?


Southwest Airlines Co. (NYSE:LUV) went up by 0.43% from its latest closing price compared to the recent 1-year high of $58.83. The company’s stock price has collected 1.68% of gains in the last five trading sessions. MarketWatch.com reported 9 hours ago that Air travel is back? Before buying up airline stocks on TSA’s latest upbeat figures, check out this chart

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Is It Worth Investing in Southwest Airlines Co. (NYSE :LUV) Right Now?

Southwest Airlines Co. (NYSE:LUV) scored a price-to-earnings ratio above its average ratio, recording 116.86 x from its present earnings ratio. Plus, the 36-month beta value for LUV is at 1.23.

The average price from analysts is $45.22, which is $5.62 above the current price. LUV currently public float of 587.78M and currently shorts hold a 3.27% ratio of that float. Today, the average trading volume of LUV was 11.48M shares.

LUV’s Market Performance

LUV stocks went up by 1.68% for the week, with a monthly jump of 0.05% and a quarterly performance of 18.53%, while its annual performance rate touched -25.49%. The volatility ratio for the week stands at 2.31% while the volatility levels for the past 30 days are set at 3.48% for Southwest Airlines Co.. The simple moving average for the period of the last 20 days is 3.96% for LUV stocks with a simple moving average of 2.70% for the last 200 days.

Analysts’ Opinion of LUV

Many brokerage firms have already submitted their reports for LUV stocks, with JP Morgan repeating the rating for LUV by listing it as a “Underweight.” The predicted price for LUV in the upcoming period, according to JP Morgan is $41 based on the research report published on October 07th of the current year 2020.

Morgan Stanley, on the other hand, stated in their research note that they expect to see LUV reach a price target of $54. The rating they have provided for LUV stocks is “Overweight” according to the report published on September 08th, 2020.

Berenberg gave a rating of “Buy” to LUV, setting the target price at $45 in the report published on September 02nd of the current year.

LUV Trading at 5.61% from the 50-Day Moving Average

After a stumble in the market that brought LUV to its low price for the period of the last 52 weeks, the company was unable to rebound, for now settling with -32.26% of loss for the given period.

Volatility was left at 3.48%, however, over the last 30 days, the volatility rate increased by 2.31%, as shares surge +6.21% for the moving average over the last 20 days. Over the last 50 days, in opposition, the stock is trading +19.74% upper at present.

During the last 5 trading sessions, LUV rose by +1.68%, which changed the moving average for the period of 200-days by -26.68% in comparison to the 20-day moving average, which settled at $38.45. In addition, Southwest Airlines Co. saw -26.18% in overturn over a single year, with a tendency to cut further losses.

Insider Trading

Reports are indicating that there were more than several insider trading activities at LUV starting from Watterson Andrew M, who sale 210 shares at the price of $32.75 back on May 29. After this action, Watterson Andrew M now owns 31,032 shares of Southwest Airlines Co., valued at $6,878 using the latest closing price.

Watterson Andrew M, the EVP & Chief Revenue Officer of Southwest Airlines Co., sale 6,036 shares at $32.55 during a trade that took place back on May 29, which means that Watterson Andrew M is holding 31,242 shares at $196,485 based on the most recent closing price.

Stock Fundamentals for LUV

Current profitability levels for the company are sitting at:

  • +13.40 for the present operating margin
  • +26.89 for the gross margin

The net margin for Southwest Airlines Co. stands at +10.26. The total capital return value is set at 22.17, while invested capital returns managed to touch 18.16. Equity return is now at value 1.60, with 0.60 for asset returns.

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Based on Southwest Airlines Co. (LUV), the company’s capital structure generated 40.64 points at debt to equity in total, while total debt to capital is 28.90. Total debt to assets is 14.79, with long-term debt to equity ratio resting at 28.72. Finally, the long-term debt to capital ratio is 20.42.

Currently, EBITDA for the company is -1.58B with total debt to EBITDA at 0.63. When we switch over and look at the enterprise to sales, we see a ratio of 1.29, with the company’s debt to enterprise value settled at 0.14. The receivables turnover for the company is 27.12 and the total asset turnover is 0.83. The liquidity ratio also appears to be rather interesting for investors as it stands at 0.67.

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