Southwest Airlines Receives 'Sell' Rating from Melius

Investment firm Melius has reaffirmed their 'sell' stance on Southwest Airlines (NYSE:LUV), setting a price target of $26.00 for the airline's shares. This coincides with a financial analysis released on Monday, which has now been widely circulated amongst market observers.

A Mixed Perspective from Analysts

On the backdrop of Melius's verdict, various other financial entities have also provided their ratings on Southwest Airlines. Susquehanna touched upon the topic recently, reducing their price goal from $27.00 to $25.00 but maintaining a 'neutral' rating. Contrastingly, Raymond James continues to back the airline with an 'outperform' rating, albeit lowering their target from $33.00 to $30.00.

Jefferies Financial Group shifted their position from 'hold' to 'underperform' and slashed their price target from $28.00 down to $20.00. Likewise, StockNews.com demoted Southwest Airlines from 'hold' to 'sell'. On another note, Morgan Stanley adjusted their price target from $40.00 to $38.0 yet sustained an 'overweight' rating. Overall, amid five 'sell' ratings, ten 'holds', and four 'buys', the airline currently holds an aggregate 'hold' rating with a consensus target price of approximately $29.88 according to data gathered by MarketBeat.com.

Financial Highlights and Share Movement

On Monday, Southwest Airlines' shares opened at $29.72. The airlines has experienced both high and lows over the past twelve months, reaching up to $39.53 and plunging to a low of $21.91. With regard to trading averages, the 50-day moving average stands at $27.72 with a more extended 200-day average at $29.27. They have been grappling with a debt-to-equity ratio of 0.78, holding a market capitalization of $17.78 billion, a P/E ratio of 47.17, and a beta of 1.15.

The quarterly earnings report unveiled on April 25th revealed the airline's challenges, posting a (-$0.36) earnings per share, which was marginally below consensus estimates. Despite the setback, revenues showed a growth of 11% year-on-year. Analysts now foresee an EPS of $1.05 for the running fiscal year.

Recent Corporate Announcements

Southwest Airlines has declared a quarterly dividend of $0.18 per share to be paid on July 10th to shareholders recorded on June 19th. This denotes an annual dividend rate of $0.72 and a yield of 2.42%, prior to the ex-dividend date set for June 18th. Currently, the company's payout ratio is at 114.29%.

Institutional Investment Fluctuations

Evidence of shifting sentiments is seen in the recent investment patterns among institutional investors, with some increasing their stakes and others scaling back in Southwest Airlines. Notably, Hexagon Capital Partners LLC amplified its holdings by 374%, and similar interest is observed from other firms like Capital Advisors Ltd. LLC and First Horizon Advisors Inc. Institutional investors now own 80.82% of LUV's stock.

About Southwest Airlines Co.

Southwest Airlines Co., a seasoned player in the aviation sector, provides passenger airline services primarily within the United States and to select international destinations. As the company stood at the end of 2023, its operations incorporated 817 Boeing 737 aircraft catering to 121 destinations across multiple states, districts, and countries in close proximity.

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