Southwest Airlines Co [NYSE: LUV] gained 2.33% or 0.54 points to close at $23.70 with a heavy trading volume of 10902429 shares. The company report on November 2, 2023 at 10:00 AM that SOUTHWEST AIRLINES SIGNS AGREEMENT WITH USA BIOENERGY TO PURCHASE UP TO 680 MILLION GALLONS OF SUSTAINABLE AVIATION FUEL.
Carrier establishes long-term strategic relationship with SAF producer.
Southwest Airlines Co. (NYSE: LUV) (“Southwest”) today announced an offtake agreement with USA BioEnergy, LLC (“USA BioEnergy”), for up to 680 million gallons of neat sustainable aviation fuel (SAF). Over the term of the 20-year agreement, once blended with conventional jet fuel, the SAF could produce the equivalent of 2.59 billion gallons of net-zero1 fuel and avoid 30 million metric tons of CO2. Southwest® plans to begin purchasing SAF from USA BioEnergy’s facility near Bon Wier, Texas, as early as 2028. Additionally, as part of the offtake agreement, Southwest and USA BioEnergy have established a long-term strategic relationship offering Southwest the opportunity to purchase up to another projected 180 million gallons of SAF per year from future planned production facilities.
It opened the trading session at $23.58, the shares rose to $23.94 and dropped to $23.39, the range by which the price of stock traded the whole day. The daily chart for LUV points out that the company has recorded -20.09% loss over the past six months. However, it is still -8.17% lower than its most recent low trading price.
If we look at the average trading volume of 7.12M shares, LUV reached to a volume of 10902429 in the most recent trading day, which is why market watchdogs consider the stock to be active.
Here is what top equities market gurus are saying about Southwest Airlines Co [LUV]:
Based on careful and fact-backed analyses by Wall Street experts, the current consensus on the target price for LUV shares is $28.56 per share. Analysis on target price and performance of stocks is usually carefully studied by market experts, and the current Wall Street consensus on LUV stock is a recommendation set at 2.91. This rating represents a strong Buy recommendation, on the scale from 1 to 5, where 5 would mean strong sell, 4 represents Sell, 3 is Hold, and 2 indicates Buy.
TD Cowen have made an estimate for Southwest Airlines Co shares, keeping their opinion on the stock as Market Perform, with their previous recommendation back on October 27, 2023.
The Average True Range (ATR) for Southwest Airlines Co is set at 0.74, with the Price to Sales ratio for LUV stock in the period of the last 12 months amounting to 0.56. The Price to Book ratio for the last quarter was 1.28, with the Price to Cash per share for the same quarter was set at 19.68.
Trading performance analysis for LUV stock
Southwest Airlines Co [LUV] gain into the green zone at the end of the last week, gaining into a positive trend and gaining by 6.09. With this latest performance, LUV shares dropped by -13.25% in over the last four-week period, additionally sinking by -20.09% over the last 6 months – not to mention a drop of -35.07% in the past year of trading.
Overbought and oversold stocks can be easily traced with the Relative Strength Index (RSI), where an RSI result of over 70 would be overbought, and any rate below 30 would indicate oversold conditions. An RSI rate of 50 would represent a neutral market momentum. The current RSI for LUV stock in for the last two-week period is set at 38.39, with the RSI for the last a single of trading hit 45.96, and the three-weeks RSI is set at 35.15 for Southwest Airlines Co [LUV]. The present Moving Average for the last 50 days of trading for this stock 27.09, while it was recorded at 22.77 for the last single week of trading, and 31.52 for the last 200 days.
Southwest Airlines Co [LUV]: A deeper dive into fundamental analysis
Operating Margin for any stock indicates how profitable investing would be, and Southwest Airlines Co [LUV] shares currently have an operating margin of +0.78 and a Gross Margin at +16.46. Southwest Airlines Co’s Net Margin is presently recorded at +2.26.
Return on Total Capital for LUV is now 0.86, given the latest momentum, and Return on Invested Capital for the company is 2.58. Return on Equity for this stock inclined to 5.11, with Return on Assets sitting at 1.43. When it comes to the capital structure of this company, Southwest Airlines Co [LUV] has a Total Debt to Total Equity ratio set at 88.25. Additionally, LUV Total Debt to Total Capital is recorded at 46.88, with Total Debt to Total Assets ending up at 25.24. Long-Term Debt to Equity for the company is recorded at 85.75, with the Long-Term Debt to Total Capital now at 45.55.
Reflecting on the efficiency of the workforce at the company, Southwest Airlines Co [LUV] managed to generate an average of $8,086 per employee. Receivables Turnover for the company is 19.87 with a Total Asset Turnover recorded at a value of 0.63.Southwest Airlines Co’s liquidity data is similarly interesting compelling, with a Quick Ratio of 1.14 and a Current Ratio set at 1.21.
Southwest Airlines Co [LUV]: An earnings per share (EPS) analysis
The progress of the company may be observed through the prism of EPS growth rate, while Wall Street analysts are focusing on predicting the 5-year EPS growth rate for LUV. When it comes to the mentioned value, analysts are expecting to see the 5-year EPS growth rate for Southwest Airlines Co go to 29.00%.
An analysis of Institutional ownership at Southwest Airlines Co [LUV]
The top three institutional holders of LUV stocks are: VANGUARD GROUP INC with ownership of 1.3 billion shares, which is approximately 8.2579%. BLACKROCK INC., holding 1.04 billion shares of the stock with an approximate value of $201.66 billion in LUV stocks shares; and BERKSHIRE HATHAWAY INC, currently with $177.59 billion in LUV stock with ownership which is approximately 5.7994%.