NEW YORK (TheStreet) -- Southwest Airlines (LUV) shares are up 1.52% to $42.96 in early market trading on Monday following a Barron's report Saturday suggesting that airline stocks could gain by as much as 50% in a year.
While Southwest is set to rise just like its counterparts, according to the report, it may be primed to do so at a much more modest rate due to the stock's already strong performance over the past three years.
"Southwest's share price has more than tripled in the past three years, to 34.22. But Southwest now trades at a premium to the group and could be challenged to perform as well as its peers from here. One of the keys to its past success has been offering low prices on high-frequency, short-haul flights, particularly between mid-size cities." said Barron's writer Jack Hough.
The report stated that the big four airline companies, Southwest, Delta Air Lines (DAL), United Continental (UAL) and American Airlines Group (AAL), could rise between 15% and 50% in a year.
This optimistic outlook is due to falling jet fuel prices due to the global supply glut of crude, economic growth and lessons the industry has learned about the negative impact of increasing capacity too quickly.
TheStreet Ratings team rates SOUTHWEST AIRLINES as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation: