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ValuEngine: Southwest Airlines Is Top S&P500 Stock

|Includes: CB, DAL, DHI, FSLR, GPN, Southwest Airlines Co. (LUV), T, TRV, TSN, UNM

VALUATION WATCH: Overvalued stocks now make up 47.35% of our stocks assigned a valuation and 13.6% of those equities are calculated to be overvalued by 20% or more. Eight sectors are calculated to be overvalued.

LUV Rules --ValuEngine: Southwest Airlines Is Top S&P500 Stock

We can use our data to track individual stocks, industries, sectors, and indices. For today's bulletin, we present key metrics for the top picks in the S&P 500. The companies listed below represent the top-ten BUY/STRONG BUY stocks within the index. They are presented below according to their one-month forecast target prices.

For June, we see a 50% turnover in our list. Traveler's has finally been dethroned from its longtime top spot by newcomer Southwest Airlines. DR Horton, Chubb, and AT&T also declined a few positions. Poultry giant Tyson has moved up while AIZ, AFL, HIG, AVGO, and KLAC have fallen out of the top-ten list. Other newcomers this week include Delta Airlines, Global Payments, UNUM Group, and First Solar.

 

 

 

 

 

 

 

 

 

 

 

Ticker Company Name Market Price Valuation Last 12-M Retrn 1-M Forecast Retn 1-Yr Forecast Retn P/E Ratio Sector Name Last Month Top Ten
LUV SOUTHWEST AIR 42.54 -12.64% 12.39% 1.25% 15.08% 10.92 Transportation TRV
TRV TRAVELERS COS 114.84 2.35% 13.69% 1.14% 13.67% 10.91 Finance DHI
TSN TYSON FOODS A 64.31 4.03% 52.32% 1.11% 13.29% 16.04 Consumer Staples AIZ
DHI D R HORTON INC 30.88 -0.23% 16.79% 1.05% 12.63% 13.91 Construction CB
DAL DELTA AIR LINES 43.51 -30.13% -1.89% 1.03% 12.37% 7.38 Transportation TSN
CB CHUBB LTD 127.33 10.19% 19.70% 1.01% 12.11% 13.38 Finance T
GPN GLOBAL PAYMENTS 77.71 -41.99% 48.39% 0.98% 11.80% 26.25 Business Services AFL
T AT&T INC 38.73 0.50% 12.75% 0.97% 11.67% 13.83 Utilities HIG
UNM UNUM GROUP 36.75 1.43% 5.09% 0.97% 11.65% 9.84 Finance AVGO
FSLR FIRST SOLAR INC 50.07 -2.98% 0.34% 0.97% 11.63% 6.93 Oils-Energy KLAC

NOTE: New stocks are in BOLD

Below is today's data on our new SP500 leader, Southwest Airlines (NYSE:LUV):

Southwest Airlines is a major domestic airline that provides primarily shorthaul, high-frequency, point-to-point, low-fare service. Southwest operates over Boeing 737 aircraft in numerous cities. Southwest has the lowest operating cost structure in the domestic airline industry and consistently offers the lowest and simplest fares. Southwest also has one of the best overall Customer Service records.

VALUENGINE RECOMMENDATION: ValuEngine continues its STRONG BUY recommendation on SOUTHWEST AIR for 2016-06-01. Based on the information we have gathered and our resulting research, we feel that SOUTHWEST AIR has the probability to OUTPERFORM average market performance for the next year. The company exhibits ATTRACTIVE Company Size and Sharpe Ratio.

You can download a free copy of detailed report on LUV from the link below.


 






ValuEngine Forecast
  Target
Price*
Expected
Return
1-Month 43.07 1.25%
3-Month 43.40 2.02%
6-Month 43.22 1.60%
1-Year 48.96 15.08%
2-Year 41.64 -2.12%
3-Year 32.48 -23.65%

 















Valuation & Rankings
Valuation 12.64% undervalued Valuation Rank(?) 70
1-M Forecast Return 1.25% 1-M Forecast Return Rank 100
12-M Return 12.39% Momentum Rank(?) 81
Sharpe Ratio 0.92 Sharpe Ratio Rank(?) 96
5-Y Avg Annual Return 25.57% 5-Y Avg Annual Rtn Rank 96
Volatility 27.81% Volatility Rank(?) 62
Expected EPS Growth 8.38% EPSGrowth Rank(?) 39
Market Cap (billions) 28.87 Size Rank 97
Trailing P/E Ratio 10.92 Trailing P/E Rank(?) 88
Forward P/E Ratio 10.07 Forward P/E Ratio Rank 80
PEG Ratio 1.30 PEG Ratio Rank 35
Price/Sales 1.43 Price/Sales Rank(?) 55
Market/Book 4.42 Market/Book Rank(?) 27
Beta 1.02 Beta Rank 44
Alpha 0.14 Alpha Rank 83
ValuEngine Market Overview

 

 

 

 

 

Summary of VE Stock Universe
Stocks Undervalued 52.65%
Stocks Overvalued 47.35%
Stocks Undervalued by 20% 22.79%
Stocks Overvalued by 20% 14.93%

 

ValuEngine Sector Overview

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sector Change MTD YTD Valuation Last 12-MReturn P/E Ratio
Consumer Staples 0.62% 0.65% 5.55% 6.34% overvalued 2.75% 23.55
Utilities -0.15% -0.10% 5.88% 5.53% overvalued -1.07% 22.91
Oils-Energy 0.46% 0.57% 11.76% 4.85% overvalued -33.49% 23.77
Multi-Sector Conglomerates 0.01% 0.05% 4.53% 4.68% overvalued -10.33% 18.05
Basic Materials -0.15% -0.12% 26.37% 4.52% overvalued 8.74% 29.33
Industrial Products 0.24% 0.28% 6.05% 2.90% overvalued -10.12% 21.49
Aerospace 0.19% 0.25% -2.19% 1.04% overvalued -4.84% 18.75
Computer and Technology 0.31% 0.39% 7.66% 0.25% overvalued -8.92% 27.89
Business Services 0.40% 0.46% 11.99% 0.55% undervalued -8.49% 22.99
Finance 0.15% 0.19% 2.41% 0.90% undervalued -4.84% 16.00
Consumer Discretionary 0.38% 0.42% 2.93% 1.34% undervalued -10.90% 22.67
Construction -0.20% -0.15% 20.93% 2.03% undervalued -4.46% 20.52
Medical 0.68% 0.79% -4.65% 3.59% undervalued -19.52% 27.12
Auto-Tires-Trucks -0.30% -0.27% -0.53% 8.15% undervalued -17.51% 11.90
Transportation -0.20% -0.16% 1.60% 8.80% undervalued -28.23% 13.62
Retail-Wholesale 0.23% 0.29% -3.38% 11.04% undervalued -11.71% 21.97

ValuEngine.com is an independent research provider, producing buy/hold/sell recommendations, target price, and valuations on over 7,000 US and Canadian equities every trading day.

Supporting Documents

  1. TMP_VE_LUV_2016060201772.pdf

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.