Southwest Airlines (NYSE:LUV) Announces Quarterly Earnings Results

Southwest Airlines (NYSE:LUV) issued its quarterly earnings data on Wednesday. The airline reported $0.58 EPS for the quarter, beating the consensus estimate of $0.56 by $0.02, FiscalAI reports. Southwest Airlines had a net margin of 1.38% and a return on equity of 6.39%. The firm had revenue of $7.44 billion during the quarter, compared to the consensus estimate of $7.51 billion. During the same period in the prior year, the firm posted $0.56 earnings per share. The company’s quarterly revenue was up 7.4% compared to the same quarter last year. 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 opened at $40.94 on Thursday. Southwest Airlines has a 12-month low of $23.82 and a 12-month high of $45.02. The stock has a market capitalization of $21.17 billion, a price-to-earnings ratio of 62.98, a PEG ratio of 0.37 and a beta of 1.16. The firm’s 50-day moving average price is $40.07 and its two-hundred day moving average price is $35.05. The company has a current ratio of 0.49, a quick ratio of 0.42 and a debt-to-equity ratio of 0.52.

Southwest Airlines Dividend Announcement

The firm also recently declared a quarterly dividend, which was paid on Friday, January 16th. Investors of record on Friday, December 26th were issued a dividend of $0.18 per share. This represents a $0.72 dividend on an annualized basis and a yield of 1.8%. The ex-dividend date was Friday, December 26th. Southwest Airlines’s dividend payout ratio (DPR) is 110.77%.

Institutional Inflows and Outflows

A number of hedge funds and other institutional investors have recently bought and sold shares of the stock. AQR Capital Management LLC grew its holdings in shares of Southwest Airlines by 100.6% during the 1st quarter. AQR Capital Management LLC now owns 39,347 shares of the airline’s stock worth $1,303,000 after purchasing an additional 19,729 shares in the last quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. grew its stake in Southwest Airlines by 5.4% in the 1st quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. now owns 61,060 shares of the airline’s stock valued at $2,050,000 after buying an additional 3,141 shares in the last quarter. Empowered Funds LLC boosted its position in Southwest Airlines by 7.6% during the 1st quarter. Empowered Funds LLC now owns 7,459 shares of the airline’s stock valued at $250,000 after acquiring an additional 527 shares in the last quarter. EverSource Wealth Advisors LLC increased its holdings in Southwest Airlines by 73.4% in the 2nd quarter. EverSource Wealth Advisors LLC now owns 5,690 shares of the airline’s stock worth $185,000 after acquiring an additional 2,408 shares in the last quarter. Finally, First Trust Advisors LP increased its stake in Southwest Airlines by 47.4% in the second quarter. First Trust Advisors LP now owns 307,602 shares of the airline’s stock worth $9,979,000 after purchasing an additional 98,986 shares during the period. 80.82% of the stock is owned by hedge funds and other institutional investors.

Analysts Set New Price Targets

Several brokerages have issued reports on LUV. JPMorgan Chase & Co. raised Southwest Airlines from an “underweight” rating to an “overweight” rating and increased their target price for the company from $36.00 to $60.00 in a research report on Friday, January 9th. Seaport Research Partners upped their price objective on shares of Southwest Airlines from $46.00 to $52.00 and gave the stock a “buy” rating in a report on Friday, January 9th. Jefferies Financial Group raised their price objective on shares of Southwest Airlines from $42.00 to $45.00 and gave the stock a “hold” rating in a report on Monday. Bank of America increased their price objective on Southwest Airlines from $28.00 to $37.00 and gave the stock an “underperform” rating in a research report on Tuesday, January 6th. Finally, UBS Group upped their price target on Southwest Airlines from $43.00 to $45.00 and gave the stock a “neutral” rating in a report on Tuesday, January 6th. Six research analysts have rated the stock with a Buy rating, eleven have issued a Hold rating and four have issued a Sell rating to the stock. According to data from MarketBeat, Southwest Airlines currently has an average rating of “Hold” and an average price target of $42.37.

Southwest Airlines News Roundup

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

• Positive Sentiment: Management issued very strong FY?2026 guidance, forecasting adjusted EPS of at least $4.00 (up sharply from 2025), a figure management says reflects revenue initiatives and the company’s business transformation. SOUTHWEST AIRLINES REPORTS FOURTH QUARTER AND FULL YEAR 2025 RESULTS
• Positive Sentiment: Q4 earnings slightly beat consensus on an EPS basis (reported ~$0.58 vs. estimates ~0.55/0.56) and management highlighted improved operating profit and net income year?over?year. Beats support confidence in profitability improvement. Southwest Airlines (LUV) Surpasses Q4 Earnings Estimates
• Positive Sentiment: Strategic changes — ending 54 years of open seating, introducing assigned seats and earlier baggage fees — are explicitly tied to revenue and margin upside by management and coverage, reinforcing the bullish long?term thesis. Southwest ends open seating after 54 years. Here’s what the last flight was like
• Neutral Sentiment: Revenue was modestly below street expectations (Q4 revenue ~$7.44B vs. estimates around $7.5B), a sign the top line hasn’t fully caught up to margin gains. Southwest (LUV) Reports Q4 Earnings: What Key Metrics Have to Say
• Neutral Sentiment: Quarterly cash flow dynamics were mixed — operating cash fell and cash balances declined while capex rose — which matters for liquidity as the company scales initiatives. Southwest Airlines Company (LUV) Stock Rises on Q4 2025 Earnings
• Negative Sentiment: First?quarter 2026 EPS guidance came in below consensus (management guided to ~$0.45 vs. street ~0.57), signaling near?term earnings pressure despite the strong full?year outlook. SOUTHWEST AIRLINES REPORTS FOURTH QUARTER AND FULL YEAR 2025 RESULTS
• Negative Sentiment: Unusual options activity showed a sizable uptick in put buying (40,382 puts, ~65% above typical daily volume), indicating some traders are hedging or expressing short?term bearishness.
• Positive Sentiment: Some analysts raised targets (Jefferies increased its price target to $45), reflecting improved expectations from select sell?side firms. Jefferies Financial Group Raises Southwest Airlines (NYSE:LUV) Price Target to $45.00

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.