Southwest Airlines (LUV) closed at $57.49 in the latest trading session, marking a +1.99% move from the prior day. The stock outpaced the S&P 500’s daily gain of 1.56%. Elsewhere, the Dow gained 1.77%, while the tech-heavy Nasdaq added 2.2%.
Heading into today, shares of the airline had gained 21.28% over the past month, outpacing the Transportation sector’s gain of 9.85% and the S&P 500’s gain of 6.41% in that time.
Investors will be hoping for strength from LUV as it approaches its next earnings release, which is expected to be April 25, 2019. The company is expected to report EPS of $0.83, up 10.67% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $5.34 billion, up 8% from the year-ago period.
LUV’s full-year Zacks Consensus Estimates are calling for earnings of $5.03 per share and revenue of $23.65 billion. These results would represent year-over-year changes of +18.63% and +7.67%, respectively.
Any recent changes to analyst estimates for LUV should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company’s business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 5.88% higher. LUV is currently sporting a Zacks Rank of #2 (Buy).
Looking at its valuation, LUV is holding a Forward P/E ratio of 11.2. This represents a premium compared to its industry’s average Forward P/E of 9.64.
We can also see that LUV currently has a PEG ratio of 0.89. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company’s expected earnings growth rate. The Transportation – Airline was holding an average PEG ratio of 0.89 at yesterday’s closing price.
The Transportation – Airline industry is part of the Transportation sector. This group has a Zacks Industry Rank of 7, putting it in the top 3% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
To follow LUV in the coming trading sessions, be sure to utilize Zacks.com.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Be the first to comment