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Is Southwest Airlines Co.(NYSE: LUV), a large market cap stock a smart buy?

With a market cap of has a large market cap size. Southwest Airlines Co. (NYSE: LUV) has been on the stock market since its IPO date on the 1/2/1980. Southwest Airlines Co. is in the Regional Airlines industry and Services sector. Average volume for Southwest Airlines Co., is 6605.31, and so far today it has a volume of 2513. Performance year to date since the 1/2/1980 is -0.09%.

To help you determine whether Southwest Airlines Co. is undervalued the following values will help you decide. P/E is 12.6 and forward P/E is 9.77. PEG perhaps more useful shows that Southwest Airlines Co. has a value for PEG of 0.72. P/S ratio is 1.36 and the P/B ratio is 3.66. The P/Cash and P/Free cash flow is 7.67 and 22.69 respectively.

At the current price Southwest Airlines Co. is trading at, 43.15 (0.72% today), Southwest Airlines Co. has a dividend yield of 0.93%, and this is covered by a payout ratio of 8.70%. Earnings per share (EPS) is 3.4, and this is looking to grow in the next year to 7.53% after growing 99.60% this past year. EPS growth quarter over quarter is 18.70%, and 9.30% for sales growth quarter over quarter.

The number of shares outstanding is 641, and the number of shares float is 637.69. The senior management bring insider ownership to 0.20%, and institutional ownership is at 80.20%. The float short is 2.41%, with the short ratio at a value of 2.32. Management has seen a return on assets of 10.50%, and also a return on investment of 26.30%.

The ability for Southwest Airlines Co., to deal with debt, means it current ratio is 0.6, and quick ratio is 0.5. Long term debt/equity is 0.33 and total debt/equity is 0.46. In terms of margins, Southwest Airlines Co. has a gross margin of 75.20%, with its operating margin at 21.20%, and Southwest Airlines Co. has a profit margin of 11.10%.

The 52 week high is -15.47%, with 31.75% being its 52 week low. The 20 day simple moving average is 4.60% and the 200 day simple moving average is 2.00%.

Disclaimer: Remember there is a risk to your investment, this is not a recommendation, nor personal advice, never invest more than you are able too loose.


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Tony Dabbs

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