Skip to main content

Trade-Ideas LLC identified

Southwest Airlines

(

LUV

) as a new lifetime high candidate. In addition to specific proprietary factors, Trade-Ideas identified Southwest Airlines as such a stock due to the following factors:

  • LUV has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $234.3 million.
  • LUV has traded 14,663 shares today.
  • LUV is trading at a new lifetime high.

EXCLUSIVE OFFER: Get the inside scoop on opportunities in LUV with the Ticky from Trade-Ideas. See the FREE profile for LUV NOW at Trade-Ideas

More details on LUV:

Southwest Airlines Co. operates passenger airlines that provide scheduled air transportation services in the United States and near-international markets. As of December 31, 2014, it operated 665 Boeing 737 aircraft; and had 12 Boeing 717 aircraft. The stock currently has a dividend yield of 0.7%. LUV has a PE ratio of 17. Currently there are 9 analysts that rate Southwest Airlines a buy, 2 analysts rate it a sell, and 2 rate it a hold.

TheStreet Recommends

The average volume for Southwest Airlines has been 6.9 million shares per day over the past 30 days. Southwest Airlines has a market cap of $30.1 billion and is part of the services sector and transportation industry. The stock has a beta of 1.20 and a short float of 2.4% with 2.91 days to cover. Shares are up 10.8% year-to-date as of the close of trading on Thursday.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Southwest Airlines as a

buy

. The company's strengths can be seen in multiple areas, such as its revenue growth, impressive record of earnings per share growth, good cash flow from operations, expanding profit margins and solid stock price performance. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 5.6%. Since the same quarter one year prior, revenues slightly increased by 7.2%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • SOUTHWEST AIRLINES reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, SOUTHWEST AIRLINES increased its bottom line by earning $1.65 versus $1.06 in the prior year. This year, the market expects an improvement in earnings ($3.53 versus $1.65).
  • Net operating cash flow has significantly increased by 247.91% to $835.00 million when compared to the same quarter last year. In addition, SOUTHWEST AIRLINES has also vastly surpassed the industry average cash flow growth rate of 136.37%.
  • 39.41% is the gross profit margin for SOUTHWEST AIRLINES which we consider to be strong. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, LUV's net profit margin of 11.34% significantly trails the industry average.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. Looking ahead, the stock's rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that the other strengths this company displays justify these higher price levels.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.