Southwest Airlines Co (LUV): Today's Featured Transportation Winner

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Southwest Airlines ( LUV) pushed the Transportation industry higher today making it today's featured transportation winner. The industry as a whole closed the day down 0.4%. By the end of trading, Southwest Airlines rose 14 cents (1.2%) to $11.61 on average volume. Throughout the day, 7.7 million shares of Southwest Airlines exchanged hands as compared to its average daily volume of 7.6 million shares. The stock ranged in a price between $11.41-$11.65 after having opened the day at $11.47 as compared to the previous trading day's close of $11.47. Other companies within the Transportation industry that increased today were: Roadrunner Transportation Systems ( RRTS), up 9.1%, Ultrapetrol Bahamas ( ULTR), up 7.4%, Con-way ( CNW), up 5.9%, and Newlead Holdings ( NEWL), up 5.3%.
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Southwest Airlines Co. engages in the operation of a passenger airline that provides scheduled air transportation in the United States. Southwest Airlines has a market cap of $8.32 billion and is part of the services sector. The company has a P/E ratio of 20.1, above the S&P 500 P/E ratio of 17.7. Shares are up 10.1% year to date as of the close of trading on Wednesday. Currently there are eight analysts that rate Southwest Airlines a buy, one analyst rates it a sell, and five rate it a hold.

TheStreet Ratings rates Southwest Airlines as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance and notable return on equity. We feel these strengths outweigh the fact that the company shows low profit margins.

On the negative front, Rand Logistics ( RLOG), down 16.9%, DS Torm ( TRMD), down 11.7%, FreeSeas ( FREE), down 8.2%, and Guangshen Railway Company ( GSH), down 5.7%, were all laggards within the transportation industry with Copa Holdings ( CPA) being today's transportation industry laggard.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the transportation industry could consider iShares Dow Jones Transportation ( IYT) while those bearish on the transportation industry could consider ProShares UltraShort Industrials ( SIJ).

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