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Dallas, Texas-based Southwest Airlines Co. (LUV) is a passenger airline company that provides scheduled air transportation services. Valued at a market cap of $16.1 billion, the company also provides in-flight entertainment and connectivity services, and a Rapid Rewards loyalty program that enables program members to earn points for dollars spent on Southwest base fares.
Shares of this leading airline holding company have underperformed the broader market over the past year. LUV has gained 14.4% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 16.6%. Moreover, in 2025, LUV stock is down 8%, compared to the SPX’s 7.8% rise on a YTD basis.
Zooming in further, LUV has also lagged behind the U.S. Global Jets ETF (JETS). The exchange-traded fund has gained about 25.1% over the past year.
On Jul. 23, LUV shares grew marginally following the release of its Q2 2025 earnings. The airline posted revenue of $7.24 billion in the period, which fell short of Street forecasts. Moreover, the company’s adjusted EPS for the quarter was $0.43, falling short of the consensus estimate by 15.7%.
For the current fiscal year, ending in December, analysts expect LUV’s EPS to rise 7.3% to $1.03 on a diluted basis. The company has beaten the consensus estimate in three of the last four quarters, while missing on one occasion.
Among the 21 analysts covering LUV stock, the consensus is a “Hold.” That’s based on four “Strong Buy” ratings, one “Moderate Buy,” 10 “Holds,” one “Moderate Sell,” and five “Strong Sells.”
This configuration is slightly less bullish than a month ago, when it had five “Strong Buy” ratings.
On Jul. 26, Evercore ISI analyst Duane Pfennigwerth maintained a “Hold” rating on Southwest Airlines and set a price target of $40.
The stock currently trades above its mean price target of $30.56. The Street-high price target of $46 suggests an ambitious upside potential of 48.7%.
On the date of publication, Kritika Sarmah did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
