Seeking Alpha

Southwest Airlines Co. (LUV)

  • Tue, Nov. 24, 1:49 PM
    • A global travel warning issued by the U.S. Department is impacting several sectors. Hotel stocks are notably weaker, while amusement park stocks are also trailing broad market averages. Airlines are feeling a double whammy from travel demand concerns and a 3% rise in crude oil futures.
    • In some cases the sell-off appears to be an overreaction with little evidence in that travel habits will change dramatically, according to some analysts.
    • Decliners include Hyatt Hotels (H -1.5%), Hilton Worldwide (HLT -1.1%), Marriott International (MAR -1.8%), JetBlue (JBLU -1.7%), Delta Air Lines (DAL -3.3%), American Airlines Group (AAL -2.4%), United Continental (UAL -3.2%), Allegiant Travel (ALGT -5.3%), Spirit Airlines (SAVE -4.1%), Southwest Airlines (LUV -2.7%), Six Flags (SIX -1.0%), Cedar Fair (FUN -1.0%), Disney (DIS -0.9%), and Sabre (SABR -3.9%), Virgin Amerinca (VA -2.5%), Alaska Air Group (ALK -1.5%).
    • Previously: PCLN, EXPE, TRIP sell off after State Department issues travel warning (Nov. 24)
    | Tue, Nov. 24, 1:49 PM | 16 Comments
  • Thu, Oct. 22, 9:04 AM
    • Southwest Airlines (NYSE:LUV) is higher after the company reported Q3 profit improved 78% from a year ago.
    • Revenue passenger miles were up 7.6% to 30.559B, while capacity increased at the same rate to 36.36B available seat miles.
    • Southwest's load factor was up 10 bps to 85.4%.
    • Costs per available seat mile fell 9.1% to $0.1126 with lower fuel expenses a major factor.
    • The company ended the quarter with 692 aircraft in operation, compared to 685 a year ago.
    • Previously: Southwest Airlines beats by $0.02, beats on revenue (Oct. 22 2015)
    • LUV +3.24% premarket to $42.35.
    | Thu, Oct. 22, 9:04 AM | Comment!
  • Fri, Oct. 9, 10:29 AM
    • Airline stocks are showing some strength in early trading as investors shrug off another uptick in oil prices.
    • Solid traffic reports from United Continental and American Airlines Group are turning attention back to the robust profits being churned up in the sector.
    • United raised its Q3 profit forecast, while American saw a big jump in its load factor for September in a positive sign and gave its own favorable estimate on margins.
    • Gainers: United Continental (UAL +7.1%), American Airlines Group (AAL +4.4%), Delta Air Lines (DAL +2.5%), Hawaiian Holdings (HA +3.9%), Southwest Airlines (LUV +2.6%), Spirit Airlines (SAVE +4.7%), Virgin America (VA +3%), Allegiant Travel (ALGT +3.1%), Alaska Air Group (ALK +1.8%), JetBlue (JBLU +4.9%).
    • Related ETF: JETS.
    | Fri, Oct. 9, 10:29 AM | 6 Comments
  • Fri, Aug. 14, 9:16 AM
    • Airline stocks are on watch as U.S. crude oil prices hit their lowest level in six years.
    • The sector hasn't rallied with the same vigor as it did with previous swings lower in oil which has some analysts calling for a delayed rally.
    • Though many companies left some savings on the table due to hedging activity, fuel cost per mile flown ranged lower by 20% to 45% in the sector during Q2.
    • Earlier this week, Raymond James pitched the case that airlines will use fare increases to cover rising labor costs, leaving fuel expense savings for balance sheet moves.
    • Related stocks: DAL, UAL, AAL, SAVE, RJET, HA, ALK, JBLU, VA, ALGT, LUV.
    • Related ETF: JETS.
    | Fri, Aug. 14, 9:16 AM | 16 Comments
  • Thu, Jul. 23, 9:15 AM
    | Thu, Jul. 23, 9:15 AM | 9 Comments
  • Thu, Jul. 23, 7:31 AM
    • Southwest Airlines (NYSE:LUV) says it generated record GAAP operating income of $1.1B in Q2.
    • Passenger revenue was up 2.1% to $4.852B, while freight revenue was 4.6% higher at $46M.
    • Wages and benefit expenses +14.3% to $1.61B.
    • Fuel savings were significant during the quarter with the economic fuel cost dropping 33% to $2.02 per gallon.
    • Average passenger fare -3.4% to $157.51.
    • Load factor +70 bps to 84.6%.
    • Passenger revenue per available seat mile -4.6% to $0.1330.
    • Return on invested capital (ex-taxes and special items) jumped to 28.2% from 17.1% a year ago.
    • Previously: Southwest Airlines beats by $0.01, misses on revenue
    • LUV +3.16% premarket to $36.23.
    | Thu, Jul. 23, 7:31 AM | 2 Comments
  • Tue, Jul. 14, 11:04 AM
    • It's a topsy-turvy day for the airline sector with JetBlue (JBLU +1.5%) impressing with its June traffic numbers and Spirit Airlines (SAVE -8.5%) disappointing with guidance.
    • The bigger story might be the forecast on oil prices after the Iran nuclear deal was hammered out.
    • Though oil prices haven't moved off dramatically with the timing of excess supply on the market unknown, the development is a long-term consideration for airlines which are looking for a sustained period of lower jet fuel prices.
    • Also on the radar, capacity concerns have been dialed back a bit over the last week, while a report yesterday on booming ancillary revenue in the sector painted a bright picture.
    • Trading is mixed on Delta Air Lines (DAL +0.2%), American Airlines Group (AAL -0.8%), United Continental (UAL -0.5%), Virgin America (VA -0.4%), Allegiant Trading (ALGT -0.8%), Hawaiian Holdings (HA -0.5%), Alaska Airl Group (ALK +0.4%), Republic Airway (RJET -1.9%), and Southwest Airlines (LUV -0.4%).
    • There's always the U.S. Global Jets ETF (NYSEARCA:JETS) for a broad sector play.
    • Previously: Load factor impresses at JetBlue (Jul. 14 2015)
    • Previously: Spirit Airlines cuts 2015 op. margin guidance; shares -4.8% (Jul. 13 2015)
    | Tue, Jul. 14, 11:04 AM | 17 Comments
  • Wed, Jul. 1, 2:31 PM
    • A DOJ spokeswoman states the agency is probing potential "unlawful coordination" between some airlines. The AP states a document obtained by the news service indicates the DOJ is "investigating whether airlines are colluding to grow at a slower pace as part of an effort to keep airfares high." No word yet on which airlines are being probed.
    • Airline stocks have sold off in response. Decliners include United Continental (UAL -4.3%), American Airlines (AAL -4.1%), Southwest (LUV -4.5%), Delta (DAL -4.2%), Alaska Air (ALK -1.7%), Hawaiian Holdings (HA -4.8%), JetBlue (JBLU -5%), Spirit Airlines (SAVE -3.1%), SkyWest (SKYW -4.1%), and Virgin America (VA -1.9%).
    • The U.S. Global Jets ETF (NYSE:JETS) is down 2.8%.
    | Wed, Jul. 1, 2:31 PM | 160 Comments
  • Wed, Jun. 10, 10:30 AM
    • The EPA says greenhouse gases from aircraft endanger human health, a finding that begins a process to regulate greenhouse gas emissions from the aviation industry, the latest sector to be regulated under the Clean Air Act after cars, trucks and power plants.
    • The endangerment finding allows the EPA to implement domestically a global carbon dioxide emissions standard being developed by the International Civil Aviation Organization; the airline industry favors a global standard over individual national standards since airlines operate all over the world and want to avoid a patchwork of rules and measures.
    • GEVO, which has been working on renewable fuels for airplanes, is +3.5% today and +27% so far this month in anticipation of the EPA findings.
    • Also higher are REGI +2%, SZYM +2.5%, AMRS +2%.
    • Potential related stocks: AAL, UAL, SAVE, DAL, ALK, HA, SKYW, LUV, JBLU, VA
    | Wed, Jun. 10, 10:30 AM | 19 Comments
  • Tue, Jun. 9, 10:58 AM
    • The jittery airline sector is having a volatile day once again.
    • Capacity concerns have been the major focus of sellers, although the strong move higher of oil prices today is also in the background.
    • American Airlines Group reported a drop in its load factor earlier as capacity growth came in ahead of revenue passenger miles.
    • Though Raymond James issued a biting downgrade on American, United Continental, and Delta yesterday - some analysts such as Sterne Agee CRT's Michael Derchin think the pessimism is overdone.
    • Q2 conference calls could calm fears on capacity running hot, reasons the analyst.
    • A higher level of buybacks in the sector and reasonable valuations based on earnings projections are also factors.
    • Sector watch: Alaska Air Group (ALK -6.4%), Southwest Airlines (LUV -5.8%), SkyWest (SKYW -3.4%), Hawaiian Holdings (HA -4.7%), Spirit Airline (SAVE -4.4%), Delta Air Lines (DAL -3.7%), Allegiant Travel (ALGT -3.6%), Republic Airways (RJET -2.9%), Virgin America (VA -2.6%), United Continental (UAL -1.8%), American Airlines Group (AAL -2%), JetBlue (JBLU -1.9%).
    • The U.S. Global Jets ETF (NYSE:JETS) is down 2.96% on the day.
    • Previously: American Airlines Group's capacity up 2% in May
    | Tue, Jun. 9, 10:58 AM | 19 Comments
  • Mon, Jun. 1, 3:56 PM
    • Southwest Airlines (LUV +2.3%) CEO Gary Kelly brought some cheer to the airline sector when he told Bloomberg TV it will increase capacity this year at a 7% rate - instead of the 8% pace tipped off last month.
    • "We’re going to make sure we manage accordingly to the low end of the range. That should address some of the concerns of our investors,” said Kelly.
    • Alaska Air Group (ALK +2.2%), American Airlines Group (AAL +4.3%), Delta Air Lines (DAL +3.4%), and United Continental (UAL +3.2%) all reacted positively to the cautious stance from Southwest.
    | Mon, Jun. 1, 3:56 PM | 23 Comments
  • Wed, May 20, 10:42 AM
    • Airline stocks are making a strong move lower after oil prices react to supply data out of the U.S. and Japan along with renewed tension in Yemen.
    • Some sector analysts have noted the swings in airline share prices (up/down) are outsized compared to the impact on jet fuel prices of daily developments in the crude oil market.
    • Platts has a breakdown of how supply and demand forces in the jet fuel market bring other factors into play.
    • Leading airline decliners: Southwest Airlines (LUV -6.8%), American Airlines Group (AAL -6.1%), JetBlue (JBLU -6.3%), United Continental (UAL -6%), Spirit Airline (SAVE -5.3%), Delta Air Lines (DAL -4.9%), Alaska Air Group (ALK -3.9%), Hawaiian Holdings (HA -4.6%), Republic Airways (RJET -3.5%), Allegiant Travel (ALGT -3.8%).
    • Related ETFs: JETS.
    | Wed, May 20, 10:42 AM | 60 Comments
  • Thu, Apr. 23, 8:34 AM
    • Southwest Airlines (NYSE:LUV) posted a record revenue tally for Q1 off of a 6.2% increase in passenger revenue and double-digit gain in freight revenue.
    • Passenger revenue per available seat mile fell 0.7% to $0.1616.
    • Available seat miles (capacity) +6.0% to 32,297B.
    • Load factor +80 bps to 80.1%.
    • Average fare +0.7% to $158.01.
    • Total operating expenses fell 8% to $3.6B even as flights were added.
    • Economic fuel cost savings of $450M were struck during the quarter as the average price per gallon fell to 35.1% to $2.00.
    • LUV +1.28% premarket to $43.44.
    | Thu, Apr. 23, 8:34 AM | 1 Comment
  • Thu, Apr. 23, 8:22 AM
    • Southwest Airlines (NYSE:LUV): Q1 EPS of $0.66 beats by $0.01.
    • Revenue of $4.41B (+5.8% Y/Y) in-line.
    • Shares +1.87% PM.
    • Press Release
    | Thu, Apr. 23, 8:22 AM | 1 Comment
  • Thu, Apr. 9, 11:55 AM
    • Airlines stocks are making their typical strong move opposite the direction of oil prices.
    • The wild gyrations in the sector appear to be overdone to some analysts and industry watchers as developments in the oil patch crowd out capacity, demand, and pricing trends.
    • Fuel costs only accounted for 30% of the operating expenses for U.S. carriers last year, notes U.S. Global Investors CEO Frank Holmes.
    • He points out that airlines have also become more rational and are increasing the mix of fuel efficient planes.
    • There's also the disparity of airline stocks moving roughly in tandem despite different levels of jet fuel price exposure.
    • Previously: Fueling around with airline stocks (Feb. 07 2015)
    • Airline stocks on the move today: Hawaiian Holdings (NASDAQ:HA) -3.4%, Republic Airways (NASDAQ:RJET) -1.8%, Virgin America (NASDAQ:VA) -1.5%, American Airlines Group (NASDAQ:AAL) -1.5%, JetBlue (NASDAQ:JBLU) -1.5%, Spirit Airlines (NASDAQ:SAVE) -1.4%, Southwest Airlines (NYSE:LUV) -1.3%, Alaska Air Group (NYSE:ALK) -1.2%.
    | Thu, Apr. 9, 11:55 AM | 19 Comments
  • Thu, Mar. 26, 8:20 AM
    • Airline stocks are reacting to the jump in crude oil prices as would be expected.
    • Crude oil is markedly higher off of unrest in Yemen.
    • Delta Air Lines (NYSE:DAL) is down 4.1% in premarket action, while United Continental (NYSE:UAL) is off 2.9%.
    • Southwest Airlines (NYSE:LUV) and JetBlue (NASDAQ:JBLU) are both down about 3%.
    • No-hedging American Airlines Group (NASDAQ:AAL) continues to be a curiosity to some traders with its tendency to move in-line with peers on oil swings - despite having a different fuel pricing strategy. AAL -3.4% premarket.
    • A deeper dive into jet fuel prices is available at Platts.
    | Thu, Mar. 26, 8:20 AM | 18 Comments
Company Description
Southwest Airlines Co is an operator of passenger airline that provides scheduled air transportation in the United States and international markets.
Sector: Services
Country: United States