Southwest Airlines Co. (LUV) Is Sitting On A Potential Gold Mine

Southwest Airlines Co. (NYSE:LUV) in recent session today was buoying at a fall of -2.32% from its closing price on previous day.

Taking a look at stock we notice that its last check on previous day was $37.55 and 5Y monthly beta was reading 1.28 with its price kept floating in the range of $35.82 and $37.14 on the day. Company’s P/E ratio for the trailing 12 months is 110.12. Considering stock’s 52-week price range provides that LUV hit a high price of $58.83 and saw its price falling to a low level of $22.47 during that period. Over a period of past 1-month, stock came adding 1.73% in its value.

With its current market valuation of $22.47 Billion, Southwest Airlines Co. is set to declare its quarterly results on October 22, 2020. LUV Stock’s Forward Dividend of 0 and its yield of 0 are making investors’ thoughts stronger that it could fall further before the company announces its earnings for the current quarter. Analysts are in estimates of -$2.36 per share for company’s earnings in the current quarter and are expecting its annual EPS growth moving down to -$6.5 for 2020 with estimates of that growing to $1.35 in next year. These estimates are suggesting current year growth of -2.52% for EPS and -1.21% growth next year.

Analysts watching the company’s growth closely have provided estimates for its revenue growth with an average revenue estimate of $1.71 Billion. They suggested that in the process company could generate revenue of as low as $1.45 Billion which could climb up to $2.17 Billion to hit a high. The average estimate is representing an increase of -69.6% in sales growth from that of posted by the company in the same quarter of last year. In keeping analyst consensus estimate with, company is forecasted to be making an annual revenue of $9.65 Billion in 2020, which will be -57% less from revenue generated by the company last year.

In contrast, when we review LUV stock’s current outlook then short term indicators are assigning it an average of Hold, while medium term indicators are categorizing the stock at an average of 50% Buy. Long term indicators are suggesting an average of Hold for it.

Having a second look at Southwest Airlines Co. (NYSE:LUV) provides that stock’s average daily trading volume for 3 months was 13.56 Million, while it dropped to 13.49 Million when we calculate an average volume for past 10 days. Number of outstanding shares of the stock currently stood at 589.87 Million.

Data compiled by Thomson Reuters highlights that percentage of outstanding shares held by the insiders is 0.25% while it is 76.34% for the institutional holders. The figures also indicate that as of August 30, 2020, number of stock’s short shares was 15290000 which implies a short ratio of 1.26. This shows up a 2.59% of Short Interest in company’s outstanding shares on the day. In August the standing of shares short improved as it was 12.55 Million in the previous month. Drop of -30.44% by stock’s current price to its year-to-date value in today’s trading is likely to be increasing investors’ worries about the stock as it is hinting a further drop.

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