(LUV) Southwest Airlines - Ratings and Ratios
Scheduled Flights, Loyalty Program, Ancillary Services
LUV EPS (Earnings per Share)
LUV Revenue
Description: LUV Southwest Airlines October 16, 2025
Southwest Airlines Co. (NYSE:LUV) is a U.S.-based passenger carrier that operates a fleet of 803 Boeing 737s to serve 117 domestic and near-international destinations across 42 states, D.C., Puerto Rico, and ten Caribbean/Latin-American markets. The airline supplements its core scheduled service with inflight entertainment, a digital-first customer experience (website, mobile apps, and the SWABIZ booking tool), and ancillary products such as EarlyBird Check-In, upgraded boarding, and pet/unaccompanied-minor transport. Its Rapid Rewards loyalty program awards points based on dollars spent on base fares. Southwest was incorporated in 1967 and is headquartered in Dallas, Texas.
Key performance indicators from the most recent filings show a 2024 Q4 revenue of roughly $5.5 billion and an operating margin of 7.2%, driven by a load factor that averaged 84% and unit revenue (RASM) of $0.115. The airline’s cost structure remains highly sensitive to jet fuel price volatility-fuel accounted for about 30% of operating expenses in 2024-and to labor negotiations, as the carrier employs over 70,000 frontline staff. Sector-wide, the passenger airline industry is currently grappling with uneven consumer confidence post-pandemic and a tightening of discretionary travel budgets, which together create a bell-curve risk profile for demand growth.
For a deeper, data-driven look at Southwest’s valuation and how it stacks up against peers, the ValueRay platform provides a concise snapshot worth exploring.
LUV Stock Overview
| Market Cap in USD | 15,737m |
| Sub-Industry | Passenger Airlines |
| IPO / Inception | 1980-01-02 |
LUV Stock Ratings
| Growth Rating | -18.6% |
| Fundamental | 53.2% |
| Dividend Rating | 53.1% |
| Return 12m vs S&P 500 | -11.2% |
| Analyst Rating | 3.0 of 5 |
LUV Dividends
| Dividend Yield 12m | 2.28% |
| Yield on Cost 5y | 1.76% |
| Annual Growth 5y | 41.42% |
| Payout Consistency | 87.7% |
| Payout Ratio | 75.0% |
LUV Growth Ratios
| Growth Correlation 3m | 19.2% |
| Growth Correlation 12m | 14.7% |
| Growth Correlation 5y | -73.3% |
| CAGR 5y | -3.13% |
| CAGR/Max DD 3y (Calmar Ratio) | -0.07 |
| CAGR/Mean DD 3y (Pain Ratio) | -0.16 |
| Sharpe Ratio 12m | 0.99 |
| Alpha | -17.63 |
| Beta | 1.200 |
| Volatility | 38.39% |
| Current Volume | 9055.7k |
| Average Volume 20d | 9405k |
| Stop Loss | 30.2 (-4.5%) |
| Signal | -0.07 |
Piotroski VR‑10 (Strict, 0-10) 6.0
| Net Income (379.0m TTM) > 0 and > 6% of Revenue (6% = 1.65b TTM) |
| FCFTA -0.01 (>2.0%) and ΔFCFTA 4.65pp (YES ≥ +1.0pp, WARN ≥ +0.5pp) |
| NWC/Revenue -20.32% (prev -5.69%; Δ -14.63pp) (YES ≤20% & Δ≤-1pp; WARN ≤25% & Δ≤0 oder ≤40% & Δ≤-3pp) |
| CFO/TA 0.07 (>3.0%) and CFO 2.02b > Net Income 379.0m (YES >=105%, WARN >=100%) |
| Net Debt (2.71b) to EBITDA (2.21b) ratio: 1.22 <= 3.0 (WARN <= 3.5) |
| Current Ratio 0.49 (target 1.5–3.0; WARN 1.2–<1.5 or >3.0–5.0; CFO/TA gate active) |
| Outstanding Shares last Quarter (551.0m) change vs 12m ago -8.32% (target <= -2.0% for YES) |
| Gross Margin 16.74% (prev 14.47%; Δ 2.27pp) >=18% & Δ>=+0.5pp (WARN >=15% & Δ>=0) |
| Asset Turnover 87.24% (prev 78.56%; Δ 8.68pp) >=50% & Δ>=+2pp (WARN >=35% & Δ>=0) |
| Interest Coverage Ratio 4.73 (EBITDA TTM 2.21b / Interest Expense TTM 130.0m) >= 6 (WARN >= 3) |
Altman Z'' 1.57
| (A) -0.20 = (Total Current Assets 5.39b - Total Current Liabilities 10.99b) / Total Assets 28.31b |
| (B) 0.57 = Retained Earnings (Balance) 16.16b / Total Assets 28.31b |
| (C) 0.02 = EBIT TTM 615.0m / Avg Total Assets 31.58b |
| (D) 0.83 = Book Value of Equity 17.04b / Total Liabilities 20.54b |
| Total Rating: 1.57 = (6.56 * A) + (3.26 * B) + (6.72 * C) + (1.05 * D) |
ValueRay F-Score (Strict, 0-100) 53.19
| 1. Piotroski 6.0pt = 1.0 |
| 2. FCF Yield -1.39% = -0.70 |
| 3. FCF Margin -0.91% = -0.34 |
| 4. Debt/Equity 0.68 = 2.28 |
| 5. Debt/Ebitda 1.22 = 1.43 |
| 6. ROIC - WACC (= -4.67)% = -5.83 |
| 7. RoE 4.27% = 0.36 |
| 8. Rev. Trend 56.78% = 4.26 |
| 9. EPS Trend 14.67% = 0.73 |
What is the price of LUV shares?
Over the past week, the price has changed by +3.13%, over one month by -2.95%, over three months by +6.27% and over the past year by +5.58%.
Is Southwest Airlines a good stock to buy?
Based on momentum, paid dividends and discounted-cash-flow analyses, the fair value of LUV is around 28.95 USD . This means that LUV is currently overvalued and has a potential downside of -8.44%.
Is LUV a buy, sell or hold?
- Strong Buy: 4
- Buy: 2
- Hold: 11
- Sell: 4
- Strong Sell: 3
What are the forecasts/targets for the LUV price?
| Issuer | Target | Up/Down from current |
|---|---|---|
| Wallstreet Target Price | 34.1 | 7.7% |
| Analysts Target Price | 34.1 | 7.7% |
| ValueRay Target Price | 32.1 | 1.5% |
LUV Fundamental Data Overview November 05, 2025
P/E Trailing = 48.3016
P/E Forward = 13.459
P/S = 0.5712
P/B = 2.1211
P/EG = 0.2421
Beta = 1.2
Revenue TTM = 27.55b USD
EBIT TTM = 615.0m USD
EBITDA TTM = 2.21b USD
Long Term Debt = 5.07b USD (from longTermDebt, last fiscal year)
Short Term Debt = 333.0m USD (from shortTermDebt, last quarter)
Debt = 5.26b USD (from shortLongTermDebtTotal, last quarter)
Net Debt = 2.71b USD (from netDebt column, last quarter)
Enterprise Value = 17.98b USD (15.74b + Debt 5.26b - CCE 3.02b)
Interest Coverage Ratio = 4.73 (Ebit TTM 615.0m / Interest Expense TTM 130.0m)
FCF Yield = -1.39% (FCF TTM -250.0m / Enterprise Value 17.98b)
FCF Margin = -0.91% (FCF TTM -250.0m / Revenue TTM 27.55b)
Net Margin = 1.38% (Net Income TTM 379.0m / Revenue TTM 27.55b)
Gross Margin = 16.74% ((Revenue TTM 27.55b - Cost of Revenue TTM 22.94b) / Revenue TTM)
Gross Margin QoQ = 16.66% (prev 18.75%)
Tobins Q-Ratio = 0.63 (Enterprise Value 17.98b / Total Assets 28.31b)
Interest Expense / Debt = 0.42% (Interest Expense 22.0m / Debt 5.26b)
Taxrate = 20.59% (14.0m / 68.0m)
NOPAT = 488.4m (EBIT 615.0m * (1 - 20.59%))
Current Ratio = 0.49 (Total Current Assets 5.39b / Total Current Liabilities 10.99b)
Debt / Equity = 0.68 (Debt 5.26b / totalStockholderEquity, last quarter 7.78b)
Debt / EBITDA = 1.22 (Net Debt 2.71b / EBITDA 2.21b)
Debt / FCF = -10.82 (negative FCF - burning cash) (Net Debt 2.71b / FCF TTM -250.0m)
Total Stockholder Equity = 8.87b (last 4 quarters mean from totalStockholderEquity)
RoA = 1.34% (Net Income 379.0m / Total Assets 28.31b)
RoE = 4.27% (Net Income TTM 379.0m / Total Stockholder Equity 8.87b)
RoCE = 4.41% (EBIT 615.0m / Capital Employed (Equity 8.87b + L.T.Debt 5.07b))
RoIC = 3.24% (NOPAT 488.4m / Invested Capital 15.07b)
WACC = 7.91% (E(15.74b)/V(21.00b) * Re(10.44%) + D(5.26b)/V(21.00b) * Rd(0.42%) * (1-Tc(0.21)))
Discount Rate = 10.44% (= CAPM, Blume Beta Adj.)
Shares Correlation 3-Years: -33.33 | Cagr: -3.85%
Fair Price DCF = unknown (Cash Flow -250.0m)
EPS Correlation: 14.67 | EPS CAGR: 159.7% | SUE: 1.31 | # QB: 1
Revenue Correlation: 56.78 | Revenue CAGR: 4.41% | SUE: 0.20 | # QB: 0
Additional Sources for LUV Stock
Tweets: X | Stocktwits
Fund Manager Positions: Dataroma | Stockcircle