NEW YORK (TheStreet) -- Shares of Southwest Airlines (LUV) - Get Report were rising in early afternoon trading on Monday as JPMorgan said that investors should buy airline stocks, according to Barron's.
"After suggesting last summer that investors enjoy a break until the turn in revenue per available seat mile (RASM) became more apparent, we believe said turning point is upon us," the firm said.
JPMorgan added that airline capacity trends are improving and that positive RASM in the second half of 2017 should "unlock stubborn multiples."
Additionally, Southwest increased domestic fares last week by $5, which JPMorgan said "represents some welcomed revenue vigor from the nation's largest discounter."
"All told, sector risk/reward looks considerably better to us than last July, even considering the modest appreciation that occurred during the earnings season," the firm noted, Barron's reports.
The firm has an "overweight" rating and $51.50 price target on shares of the Dallas-based airline operator.
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
TheStreet Ratings rated this stock as a "buy" with a ratings score of A-.
The company's strengths can be seen in multiple areas, such as its good cash flow from operations, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel its strengths outweigh the fact that the company has had lackluster performance in the stock itself.
You can view the full analysis from the report here: LUV