Zacks Investment Research cut shares of Southwest Airlines (NYSE:LUV) from a buy rating to a hold rating in a research note released on Tuesday morning.

According to Zacks, “We are impressed by Southwest Airlines' efforts to reward its shareholders through dividends and buybacks. In 2018, the carrier returned $2.3 billion to its shareholders through $332 million in dividends and $2 billion via share repurchases. The carrier's employee friendly approach also pleases us. Evidently, the company announced that it will pay $544 million to its employees as part of its 2018 profit-sharing plan. This is the 45th consecutive profit-sharing arrangement at the carrier. Southwest's efforts to modernize its fleet and expand operations are also commendable. Approval received from the FAA to start flying to the Hawaiian islands and the subsequent sale of tickets is also a positive. However, the 35-day U.S. government shutdown is expected to hurt the top line in first- quarter 2019. Also, the ongoing dispute with mechanics that has led to multiple flight cancellations/delays is a cause for concern.”

LUV has been the subject of several other reports. Imperial Capital restated an in-line rating and set a $52.00 price objective (down from $57.00) on shares of Southwest Airlines in a research report on Wednesday, January 9th. Citigroup lifted their price objective on Southwest Airlines from $59.00 to $62.00 and gave the stock a buy rating in a research report on Thursday, November 29th. Susquehanna Bancshares initiated coverage on Southwest Airlines in a research report on Wednesday, November 28th. They set a neutral rating and a $56.00 price objective for the company. Credit Suisse Group initiated coverage on Southwest Airlines in a research report on Monday, November 19th. They set a neutral rating and a $54.00 price objective for the company. Finally, Morgan Stanley cut their price objective on Southwest Airlines from $68.00 to $64.00 and set an overweight rating for the company in a research report on Wednesday, November 14th. Three equities research analysts have rated the stock with a sell rating, seven have given a hold rating and eleven have issued a buy rating to the company. The stock presently has a consensus rating of Hold and an average price target of $61.76.

Shares of Southwest Airlines stock opened at $51.16 on Tuesday. The company has a debt-to-equity ratio of 0.45, a current ratio of 0.64 and a quick ratio of 0.58. Southwest Airlines has a 1 year low of $44.28 and a 1 year high of $64.02. The company has a market cap of $27.97 billion, a P/E ratio of 12.07, a P/E/G ratio of 0.86 and a beta of 1.51.

Southwest Airlines (NYSE:LUV) last issued its quarterly earnings data on Thursday, January 24th. The airline reported $1.17 earnings per share (EPS) for the quarter, topping the Thomson Reuters’ consensus estimate of $1.06 by $0.11. Southwest Airlines had a return on equity of 24.56% and a net margin of 11.22%. The firm had revenue of $5.70 billion during the quarter, compared to the consensus estimate of $5.68 billion. During the same period in the previous year, the firm posted $0.77 EPS. The company’s quarterly revenue was up 8.5% compared to the same quarter last year. On average, analysts forecast that Southwest Airlines will post 5.12 EPS for the current fiscal year.

The firm also recently declared a quarterly dividend, which will be paid on Wednesday, March 27th. Shareholders of record on Wednesday, March 6th will be issued a $0.16 dividend. The ex-dividend date is Tuesday, March 5th. This represents a $0.64 annualized dividend and a yield of 1.25%. Southwest Airlines’s dividend payout ratio (DPR) is presently 15.09%.

Institutional investors and hedge funds have recently modified their holdings of the business. Acadian Asset Management LLC acquired a new position in Southwest Airlines in the 4th quarter valued at $33,000. Cordasco Financial Network acquired a new position in Southwest Airlines in the 4th quarter valued at $37,000. Intercontinental Wealth Advisors LLC acquired a new position in Southwest Airlines in the 4th quarter valued at $44,000. Athena Capital Advisors LLC acquired a new stake in shares of Southwest Airlines during the 4th quarter worth $45,000. Finally, Colrain Capital LLC acquired a new stake in shares of Southwest Airlines during the 4th quarter worth $46,000. Institutional investors own 79.84% of the company’s stock.

Southwest Airlines Company Profile

Southwest Airlines Co operates a passenger airline that provides scheduled air transportation services in the United States and near-international markets. As of December 31, 2017, the company operated a total of 706 Boeing 737 aircraft; and served 100 destinations in 40 states, the District of Columbia, and the Commonwealth of Puerto Rico, as well as 10 near-international countries, including Mexico, Jamaica, the Bahamas, Aruba, the Dominican Republic, Costa Rica, Belize, Cuba, the Cayman Islands, and Turks and Caicos.

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