Southwest Airlines (NYSE:LUV – Get Free Report) and Corporacion America Airports (NYSE:CAAP – Get Free Report) are both transportation companies, but which is the better stock? We will contrast the two businesses based on the strength of their earnings, dividends, profitability, analyst recommendations, institutional ownership, risk and valuation.
Analyst Recommendations
This is a summary of recent ratings and target prices for Southwest Airlines and Corporacion America Airports, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Southwest Airlines | 5 | 8 | 5 | 0 | 2.00 |
| Corporacion America Airports | 0 | 0 | 3 | 0 | 3.00 |
Southwest Airlines currently has a consensus target price of $31.88, suggesting a potential downside of 1.10%. Corporacion America Airports has a consensus target price of $22.53, suggesting a potential upside of 10.70%. Given Corporacion America Airports’ stronger consensus rating and higher possible upside, analysts plainly believe Corporacion America Airports is more favorable than Southwest Airlines.
Profitability
| Net Margins | Return on Equity | Return on Assets | |
| Southwest Airlines | 1.98% | 7.27% | 2.15% |
| Corporacion America Airports | 7.84% | 9.33% | 3.31% |
Insider & Institutional Ownership
80.8% of Southwest Airlines shares are owned by institutional investors. Comparatively, 13.0% of Corporacion America Airports shares are owned by institutional investors. 0.8% of Southwest Airlines shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
Valuation and Earnings
This table compares Southwest Airlines and Corporacion America Airports”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Southwest Airlines | $27.48 billion | 0.67 | $465.00 million | $0.85 | 37.92 |
| Corporacion America Airports | $1.84 billion | 1.80 | $282.67 million | $0.86 | 23.67 |
Southwest Airlines has higher revenue and earnings than Corporacion America Airports. Corporacion America Airports is trading at a lower price-to-earnings ratio than Southwest Airlines, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
Southwest Airlines has a beta of 1.23, suggesting that its share price is 23% more volatile than the S&P 500. Comparatively, Corporacion America Airports has a beta of 1.45, suggesting that its share price is 45% more volatile than the S&P 500.
Summary
Corporacion America Airports beats Southwest Airlines on 8 of the 14 factors compared between the two stocks.
About Southwest Airlines
Southwest Airlines Co. operates as a passenger airline company that provides scheduled air transportation services in the United States and near-international markets. As of December 31, 2023, the company operated a total fleet of 817 Boeing 737 aircraft; and served 121 destinations in 42 states, the District of Columbia, and the Commonwealth of Puerto Rico, as well as ten near-international countries, including Mexico, Jamaica, the Bahamas, Aruba, the Dominican Republic, Costa Rica, Belize, Cuba, the Cayman Islands, and Turks and Caicos. It also provides inflight entertainment and connectivity services on Wi-Fi enabled aircraft; and Rapid Rewards loyalty program that enables program members to earn points for dollars spent on Southwest base fares. In addition, the company offers a suite of digital platforms to support customers’ travel needs, including websites and apps; and SWABIZ, an online booking tool. Further, it provides ancillary services, such as Southwest’s EarlyBird Check-In, upgraded boarding, and transportation of pets and unaccompanied minors. Southwest Airlines Co. was incorporated in 1967 and is headquartered in Dallas, Texas.
About Corporacion America Airports
Corporación América Airports S.A., through its subsidiaries, acquires, develops, and operates airport concessions. It operates 52 airports in Latin America, Europe, and Eurasia. The company was formerly known as A.C.I. Airports International S.à r.l. and changed its name to Corporación América Airports S.A. in September 2017. The company was founded in 1998 and is based in Luxembourg City, Luxembourg. Corporación América Airports S.A. is a subsidiary of A.C.I. Airports S.à r.l.
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