Southwest Airlines (NYSE:LUV) Given New $55.00 Price Target at Morgan Stanley

Southwest Airlines (NYSE:LUV) had its price target boosted by Morgan Stanley from $50.00 to $55.00 in a research note released on Friday,Benzinga reports. Morgan Stanley currently has an overweight rating on the airline’s stock.

Several other equities analysts have also recently commented on the company. Bank of America boosted their target price on Southwest Airlines from $28.00 to $37.00 and gave the stock an “underperform” rating in a research report on Tuesday, January 6th. Wall Street Zen raised shares of Southwest Airlines from a “sell” rating to a “hold” rating in a research note on Saturday, October 25th. The Goldman Sachs Group increased their target price on Southwest Airlines from $26.00 to $29.00 and gave the company a “sell” rating in a report on Tuesday, January 13th. BMO Capital Markets raised shares of Southwest Airlines from a “market perform” rating to an “outperform” rating and increased their price target for the company from $43.00 to $57.50 in a research report on Friday. Finally, Raymond James Financial increased their price objective on Southwest Airlines from $42.00 to $49.00 and gave the stock an “outperform” rating in a report on Friday, December 19th. Seven equities research analysts have rated the stock with a Buy rating, ten have assigned a Hold rating and four have given a Sell rating to the company’s stock. According to MarketBeat.com, the stock presently has an average rating of “Hold” and a consensus target price of $44.76.

Southwest Airlines Trading Down 2.0%

Shares of Southwest Airlines stock opened at $47.51 on Friday. Southwest Airlines has a 1 year low of $23.82 and a 1 year high of $49.85. The stock has a fifty day moving average price of $40.71 and a 200-day moving average price of $35.21. The company has a debt-to-equity ratio of 0.57, a current ratio of 0.52 and a quick ratio of 0.42. The firm has a market cap of $24.57 billion, a PE ratio of 56.56, a P/E/G ratio of 0.44 and a beta of 1.16.

Southwest Airlines (NYSE:LUV) last released its earnings results on Wednesday, January 28th. The airline reported $0.58 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $0.56 by $0.02. The business had revenue of $7.44 billion during the quarter, compared to the consensus estimate of $7.51 billion. Southwest Airlines had a return on equity of 6.18% and a net margin of 1.57%.The business’s revenue for the quarter was up 7.4% on a year-over-year basis. During the same period last year, the business posted $0.56 earnings per share. Southwest Airlines has set its FY 2026 guidance at 4.000- EPS and its Q1 2026 guidance at 0.450- EPS. Equities research analysts anticipate that Southwest Airlines will post 1.55 EPS for the current year.

Southwest Airlines Dividend Announcement

The company also recently declared a quarterly dividend, which was paid on Friday, January 16th. Stockholders of record on Friday, December 26th were paid a $0.18 dividend. This represents a $0.72 dividend on an annualized basis and a dividend yield of 1.5%. The ex-dividend date was Friday, December 26th. Southwest Airlines’s dividend payout ratio (DPR) is 85.71%.

Institutional Trading of Southwest Airlines

Hedge funds have recently bought and sold shares of the stock. Elevation Point Wealth Partners LLC bought a new position in shares of Southwest Airlines in the second quarter worth approximately $25,000. GHP Investment Advisors Inc. bought a new position in shares of Southwest Airlines during the 4th quarter valued at about $26,000. Corsicana & Co. bought a new position in Southwest Airlines during the third quarter valued at approximately $27,000. Quent Capital LLC bought a new position in shares of Southwest Airlines during the 3rd quarter valued at approximately $27,000. Finally, Optima Capital LLC bought a new position in Southwest Airlines during the fourth quarter valued at $27,000. Institutional investors own 80.82% of the company’s stock.

Key Headlines Impacting Southwest Airlines

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

• Positive Sentiment: Management issued robust FY‑2026 guidance (at least $4.00 adjusted EPS) and signaled material upside from new seat/ancillary fees — the guidance and new revenue levers are the main driver of recent upside. Q4 Earnings Highlights
• Positive Sentiment: Q4 results beat EPS estimates ($0.58 vs. $0.56) which reinforced confidence in the recovery and margin improvement. Earnings Beat
• Positive Sentiment: Multiple bullish analyst moves raised upside expectations — Morgan Stanley to $55 (overweight), BMO upgraded to outperform with $57.50, Wells Fargo and TD Cowen lifted targets toward $50 — these upgrades support the stock’s upside narrative. Analyst Coverage
• Neutral Sentiment: Industry and stock‑screen pieces (Zacks, Seeking Alpha) compare LUV to peers and discuss valuation; helpful for context but less likely to drive immediate moves. Peer Comparison
• Negative Sentiment: Near‑term guidance is mixed: Q1 EPS guidance of ~$0.45 came in below Street estimates, and revenue trends in the quarter lagged expectations — a near‑term headwind for sentiment. Guidance & Results
• Negative Sentiment: Some large firms remain bearish or cautious despite raising targets — Goldman Sachs raised its PT to $32 but maintains a “sell” rating, and Bank of America kept an “underperform” stance with a $42 PT — these lower‑PT calls can cap rallies and prompt profit‑taking. Goldman / BofA Notes

About Southwest Airlines

Southwest Airlines Co is a U.S.-based low-cost carrier that operates a point-to-point domestic and near-international airline network. Headquartered in Dallas, Texas, the company primarily flies Boeing 737 aircraft and offers no-frills, single-class service designed to keep fares competitive. Southwest’s operating model emphasizes high aircraft utilization, quick turnaround times and an open seating policy, allowing customers to board and select seats on a first-come, first-served basis.

Founded in 1967 by Herb Kelleher and Rollin King as Air Southwest Company, Southwest began commercial service in 1971, initially connecting Dallas, Houston and San Antonio.