Southwest Airlines (NYSE:LUV) Releases FY 2026 Earnings Guidance

Southwest Airlines (NYSE:LUV) updated its FY 2026 earnings guidance on Friday. The company provided EPS guidance of 2.600-2.850 for the period, compared to the consensus estimate of 2.850. Southwest Airlines also updated its Q4 2026 guidance to 0.550-0.800 EPS.

Analyst Ratings Changes

Several research firms have recently commented on LUV. Barclays lowered their price target on shares of Southwest Airlines from $65.00 to $58.00 and set an “overweight” rating for the company in a research report on Friday, September 11th. Zacks Research downgraded shares of Southwest Airlines from a “hold” rating to a “strong sell” rating in a research report on Tuesday, October 6th. BMO Capital Markets reduced their target price on shares of Southwest Airlines from $60.00 to $50.00 and set an “outperform” rating for the company in a research note on Monday, September 28th. Bank of America upped their target price on shares of Southwest Airlines from $40.00 to $45.00 and gave the stock an “underperform” rating in a research report on Wednesday, July 1st. Finally, TD Cowen cut their price target on Southwest Airlines from $48.00 to $47.00 and set a “buy” rating on the stock in a report on Friday, October 2nd. Ten research analysts have rated the stock with a Buy rating, eight have assigned a Hold rating and four have given a Sell rating to the company. According to MarketBeat, the company presently has an average rating of “Hold” and a consensus price target of $47.45.

Southwest Airlines Price Performance

LUV stock traded down $0.29 during trading on Friday, hitting $41.74. The company had a trading volume of 8,210,911 shares, compared to its average volume of 6,459,668. The firm has a market capitalization of $20.42 billion, a price-to-earnings ratio of 20.07, a P/E/G ratio of 1.21 and a beta of 1.16. The business has a 50 day moving average of $40.57 and a 200 day moving average of $42.88. Southwest Airlines has a fifty-two week low of $29.26 and a fifty-two week high of $55.11. The company has a current ratio of 0.47, a quick ratio of 0.42 and a debt-to-equity ratio of 0.51.

Southwest Airlines (NYSE:LUV) last announced its earnings results on Wednesday, October 21st. The airline reported $0.66 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $0.57 by $0.09. The firm had revenue of $8.42 billion during the quarter, compared to analyst estimates of $8.25 billion. Southwest Airlines had a net margin of 3.34% and a return on equity of 18.05%. Southwest Airlines’s revenue was up 21.2% compared to the same quarter last year. During the same quarter in the prior year, the firm posted $0.11 EPS. As a group, research analysts predict that Southwest Airlines will post 2.67 earnings per share for the current year.

Southwest Airlines Announces Dividend

The company also recently announced a quarterly dividend, which was paid on Thursday, September 24th. Investors of record on Thursday, September 3rd were issued a dividend of $0.18 per share. The ex-dividend date of this dividend was Thursday, September 3rd. This represents a $0.72 annualized dividend and a yield of 1.7%. Southwest Airlines’s payout ratio is presently 44.17%.

Southwest Airlines News Roundup

Here are the key news stories impacting Southwest Airlines this week:

• Positive Sentiment: Southwest reported third-quarter adjusted earnings of $0.66 per share, ahead of the roughly $0.57 consensus, while revenue rose 21.2% year over year to a record $8.42 billion. Higher fares, strong demand and a 21.6% increase in revenue per available seat mile helped expand margins despite higher fuel expenses. LUV Q3 Earnings Beat on Record Revenues and Higher Fares
• Positive Sentiment: Management indicated that travel demand remains constructive and forecast fourth-quarter unit revenue growth of approximately 19% to 21%, supporting optimism that Southwest’s pricing and commercial initiatives are gaining traction. Southwest Airlines Gains After Q3 Earnings Beat and Record Revenue
• Positive Sentiment: UBS raised its price target from $52 to $54 and assigned a Buy rating, while JPMorgan maintained an Overweight rating and still sees substantial upside with a $58 target. UBS Southwest Airlines Rating
• Neutral Sentiment: Analyst sentiment remains mixed: Susquehanna reduced its target to $43, and Wells Fargo initiated a Hold rating, suggesting that much of the earnings improvement may already be reflected in the shares.
• Negative Sentiment: Southwest lowered its fourth-quarter 2026 adjusted EPS outlook to $0.55-$0.80, below the $0.88 consensus, and set full-year EPS guidance at $2.60-$2.85 versus an $2.85 estimate. Southwest Cuts Outlook as US Airlines Battle Fuel Costs
• Negative Sentiment: Fuel costs increased by about $821 million, and management is planning for elevated jet-fuel prices to persist into 2027. Industry-wide pressure to raise fares could support revenue but risks weakening demand and profitability. US Airlines Favor Higher Fares Over Fuller Planes

About Southwest Airlines

Southwest Airlines Co is a major U.S. passenger airline headquartered in Dallas, Texas. The company provides scheduled air transportation for leisure and business travelers, with service connecting cities throughout the United States and selected destinations in Mexico, the Caribbean, and Central America.

Southwest is known for its predominantly domestic network and point-to-point operating model. In addition to passenger flights, the company offers ancillary services and air cargo transportation.